NEW YORK (TheStreet) -- Wayfair (W), a multi-brand e-commerce company formerly known as CSN Stores, was originally founded in 2002 in Boston. The company offers a huge selection of furniture, home goods, home decor and housewares online. The company operates five e-commerce brands: Wayfair.com, Joss & Main, AllModern.com, Dwell Studio and Birch Lane.
Wayfair offers over 7 million items online and has a very attractive no-inventory business model. Furniture and housewares are drop-shipped by the manufacturer to the customer and are never stored in a Wayfair warehouse. The company's mostly female customer base loves shopping the site on mobile devices like tablets and smartphones. Daily shopping deals keep customers browsing the site constantly.
Last month, Wayfair reported total revenue of $424.4 million, up 52%. The direct retail division grew 63%, while the marketplace business was up 4%.
Some investors were concerned that the company may have spent too much money on advertising, which caused EBITDA to come in about $2 million less than expected. But I'm not concerned.
After the first-quarter report, management gave guidance for second-quarter revenue at a midpoint of $432 million. I think that is conservative. The company finished the quarter with 3.6 million active customers and added an additional 380,000 customers. And that's on top of the 359,000 customers added in the fourth quarter. The second quarter should see similar growth, since Wayfair is advertising heavily on Scripps Networks Interactive's (SNI) HGTV.