Online home goods retailer Wayfair (NYSE: W) reported Q1 CY2026 results beating Wall Street’s revenue expectations, with sales up 7.4% year on year to $2.93 billion. Its non-GAAP profit of $0.26 per share was 6.8% below analysts’ consensus estimates.
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Wayfair (W) Q1 CY2026 Highlights:
- Revenue: $2.93 billion vs analyst estimates of $2.89 billion (7.4% year-on-year growth, 1.4% beat)
- Adjusted EPS: $0.26 vs analyst expectations of $0.28 (6.8% miss)
- Adjusted EBITDA: $151 million vs analyst estimates of $146 million (5.2% margin, 3.4% beat)
- Operating Margin: -0.4%, up from -4.5% in the same quarter last year
- Free Cash Flow was -$106 million, down from $145 million in the previous quarter
- Active Customers: 21.4 million, up 300,000 year on year
- Market Capitalization: $9.58 billion
"Our strong revenue performance in Q1 translated to noteworthy profitability. Our 5.2% Adjusted EBITDA margin in the first quarter is the best Q1 result we've delivered in five years and approaches what we reported in the first quarter of 2021. Our plan remains consistent: increasingly outperform the category to drive top-line growth, flow that growth through in a manner that maximizes EBITDA dollars and grows them faster than revenue, and deploy our excess cash to manage both our upcoming maturities and dilution," said Niraj Shah, CEO, co-founder and co-chairman, Wayfair.
Company Overview
Founded in 2002 by Niraj Shah, Wayfair (NYSE: W) is a leading online retailer of mass-market home goods in the US, UK, Canada, and Germany.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Unfortunately, Wayfair’s 1.8% annualized revenue growth over the last three years was weak. This was below our standards and is a rough starting point for our analysis.
This quarter, Wayfair reported year-on-year revenue growth of 7.4%, and its $2.93 billion of revenue exceeded Wall Street’s estimates by 1.4%.
Looking ahead, sell-side analysts expect revenue to grow 5% over the next 12 months. While this projection indicates its newer products and services will catalyze better top-line performance, it is still below the sector average.
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Active Customers
Buyer Growth
As an online retailer, Wayfair generates revenue growth by expanding its number of users and the average order size in dollars.
Wayfair struggled with new customer acquisition over the last two years as its active customers have declined by 2.5% annually to 21.4 million in the latest quarter. This performance isn't ideal because internet usage is secular, meaning there are typically unaddressed market opportunities. If Wayfair wants to accelerate growth, it likely needs to enhance the appeal of its current offerings or innovate with new products. 
Luckily, Wayfair added 300,000 active customers in Q1, leading to 1.4% year-on-year growth. The quarterly print was higher than its two-year result, suggesting its new initiatives are accelerating buyer growth.
Revenue Per Buyer
Average revenue per buyer (ARPB) is a critical metric to track because it measures how much customers spend per order.
Wayfair’s ARPB growth has been exceptional over the last two years, averaging 76.8%. Although its active customers shrank during this time, the company’s ability to successfully increase monetization demonstrates its platform’s value for existing buyers. 
This quarter, Wayfair’s ARPB clocked in at $591. It grew by 5.2% year on year, faster than its active customers.
Key Takeaways from Wayfair’s Q1 Results
It was encouraging to see Wayfair beat analysts’ EBITDA expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. Overall, this print had some key positives. Investors were likely hoping for more, and shares traded down 9.1% to $66.63 immediately following the results.
So should you invest in Wayfair right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).
