Wayfair Posts 9.7% Revenue Jump, Its Best Growth Since Pandemic

Wayfair grew total net revenue 9.7% year over year to $3.4 billion in the third quarter, a result CEO Niraj Shah called the company's "strongest quarter of growth in the post-pandemic period" on Wednesday.

U.S. net revenue rose more than 11% to $3 billion. The retailer also swung to profitability. Net income reached $62 million, up from a $99 million loss in the year-ago quarter. Operating income climbed to $106 million from $38 million a year earlier. The results beat both analysts' expectations and the company's own forecasts.

Shah tied the performance to a plan the company laid out at the start of the year. "At the start of this year, we told you we expected to take share in the U.S. at a pace we had not seen in several years. With U.S. revenue growing double digits against a roughly flat category here in Q3, we've done exactly that," Shah said in a statement Wednesday.

What drove the growth?

Two customer metrics carried the quarter. Active customers increased 4.7% to 22.2 million. Orders delivered rose 12.2%. Average order value dipped slightly.

The more striking detail sits in the advertising numbers. Wayfair expanded its customer base while barely touching its ad budget, according to GlobalData Managing Director Neil Saunders. Ad spend rose just 2.4% year over year. As a share of total revenue, it fell to 9.9% from 10.6% last year.

That efficiency matters because online customer acquisition costs stay high. Saunders pointed to Wayfair's growing store network as the offset. The company's own data backs him up. At its Chicago-area location, more than half of shoppers are new to the Wayfair brand.

The physical footprint keeps expanding. In August, Wayfair announced plans for its 10th store, set to open in Altamonte Springs, Florida, in 2028. It will join existing and upcoming locations in markets including Atlanta, Denver and Columbus, Ohio.

Why does the assortment matter now?

Consumer behavior is shifting rather than collapsing. Shoppers are delaying or skipping large, expensive remodels. They still take on smaller projects.

That split favors Wayfair, Saunders said. "This is particularly helpful for Wayfair as its very broad offer and authority across many categories suits more fragmented and occasional buying patterns."

What does this change for marketers watching the home category? Wayfair is proving a large online retailer can grow share in a flat market by pairing store-based acquisition with disciplined ad spending — and smaller-ticket demand can carry a quarter when big-ticket demand stalls.

The test ahead is whether the Florida and Columbus openings can keep feeding that new-customer pipeline without pushing ad spend back above 10% of revenue.