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Wayfair Returns to Growth Amidst Furniture Industry Challenges
19 Feb
Summary
- Wayfair's annual sales grew 5.1% to $12.5 billion in 2025.
- The company achieved its third consecutive quarter of new customer growth.
- Average order values increased to $301, up from $290 a year prior.
Wayfair achieved a notable return to growth in 2025, with its annual sales climbing 5.1% to $12.5 billion. This is the first time the online furniture company has seen annual sales increase since 2020. The company's performance exceeded Wall Street's expectations for both revenue and earnings in the fourth quarter.
During the fourth quarter, Wayfair reported a revenue increase of approximately 7% to $3.34 billion compared to the previous year. The company also saw a rise in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to $224 million. This growth is attributed to strategies focused on gaining market share and improving profitability.
The company's success comes at a time when the broader furniture industry faces headwinds, including tariffs and high interest rates. Wayfair's ability to offer value and lower prices has resonated with consumers, leading to an increase in average order values to $301. Wayfair also focused on enhancing customer experience through initiatives like its rewards program and quality verification.
Looking ahead, Wayfair anticipates continued improvements in its bottom line if current sales trends persist. The company's strategic focus on customer-facing initiatives and website improvements has helped it gain share in a challenging market.
