August 4, 2026
What’s Next For Wayfair as US Growth Shows Promise?
Things are looking bright for Wayfair as of late, according to a CNBC report authored by Gabrielle Fonrouge, as the furniture retailer saw sales strength stateside which hadn’t been observed since the pandemic era.
“Wayfair on Tuesday said it saw its strongest growth in the U.S. and best free cash flow since the pandemic during its second quarter, as the online furniture company continues to take market share from legacy brick-and-mortar retailers,” Fonrouge wrote.
“In the three months ended June 30, sales in Wayfair’s largest market grew 8.7% to $3.1 billion – the most the region has grown since 2020. That year, the overall home goods industry surged and Wayfair’s business grew 55%,” she added.
Notable findings presented by the report include:
- The company delivered wins on both earnings per share and revenue: Wayfair notched EPS of 95 cents adjusted versus 89 cents anticipated, according to LSEG analysts. Revenue came in at $3.52 billion against $3.47 billion expected.
- Order count, customer count, and EBITDA up while average order value comes in a little light: Wayfair delivered 10.6 million orders versus 10.3 projected, held 21.7 million active customers gauged against 21.5 expected, and registered adjusted EBITDA of $242 million versus $230 anticipated. On the other hand, average order value was calculated at $332, falling shy of estimates of $337.57.
- Perigold is proving profitable: Wayfair’s luxury brand, Perigold, is proving very lucrative, achieving growth of over 35% according to Wayfair CEO Niraj Shah. Other specialty brands beneath the Wayfair umbrella also saw growth of ~20%.
- Wayfair stock soars: As of a few minutes before 4 p.m. EST, Wayfair stock had jumped by a massive 28.77% in daily trading, hitting just under $116 per share.
Wayfair said sales in the US grew at their fastest clip since 2021 as the home furnishings retailer draws more new shoppers with growing number of brick and mortar stores, as well as its higher-end brands https://t.co/wl2rdcq7fy
— Bloomberg (@business) August 4, 2026
Fonrouge cited remarks made by Wayfair CFO Kate Gulliver, who suggested that the retailer is aiming at snatching market share in the furniture space from established brick-and-mortar players, describing this as a growth lever as the U.S. housing market is currently “stalled.”
“Wayfair, a pandemic darling, has been working to get back to consistent growth and improve its profitability at a time when the overall home goods market remains under pressure due to tariffs, a sluggish housing market and a cash-strapped consumer,” Fonrouge stated.
“In recent quarters, it’s found growth largely by winning over more shoppers, many of whom are looking for a better value as costs remain high, said Gulliver,” she concluded.
BrainTrust
DeAnn Campbell
Head of Retail Insights, AAG Consulting Group
Mohamed Amer, PhD
Strategy Advisor, CEO & Co-Founder, BridgeCommAI
Neil Saunders
Managing Director, GlobalData
Recent Discussions
Discussion Questions
What’s next for Wayfair based on the company’s current direction and expected market / consumer forces, in your opinion? Does anything need to change?
Do you believe Wayfair will be able to maintain this degree of U.S. growth through 2026 and 2027, or will they run out of runway?
What is the key element of Wayfair’s recent success story, to your mind?
Poll
Do you believe Wayfair will be able to maintain this degree of U.S. growth in 2026 and 2027
Over the past half year, Wayfair has taken market share. The priority now is twofold. First, to keep the strong growth going. Second, to get the bottom line into the black. Achieving the former will help with the latter as it aids productivity and produces leverage. However, growth will become progressively more difficult as the benefit of tax refunds fades and Wayfair laps tougher prior year numbers. New store openings – which add to sales and also lift online revenue in their catchment – will only help marginally. The profit side of the equation relies on cutting further costs (especially marketing) and continuing to repay debt – both of those things will be a long slog.
Wayfair has always been willing to spend aggressively on advertising, and in a category with long purchase cycles, that visibility compounds over time. The market share gains from brick and mortar suggests it’s paying off, even in a tough environment for home goods.
I should expect they will continue what they are doing…and why not? Home furnishings is a curious industry: the national (e.g. Levitz) and regional (Breuners, Barker Bros, et al) chains that we remember from childhood have disappeared, and the product(s) increasingly are absent from department stores. So where do folks buy furniture? At companies like Wayfair, it seems.
Physical stores are the key reason for Wayfair’s growing profitability and success. After opening their Chicago flagship, Illinois sales overall were 15% above Wayfair’s national average, with a 35% increase in high consideration purchases like appliances and bathroom renos. More importantly, over 50% of in-store customers across all their current stores are net new to the brand. This means stores are driving new customer acquisition, in addition to the halo effect of lifting sales in each surrounding geographic area.
And unlike most DTC brands, Wayfair was cautious with physical growth. Only after testing pop-ups and partner spaces did they realize it wasn’t possible to convey their brand value in limited spaces. Today they’re being strategic in their store locations, and quick to alter store designs and merch plans to suit each local community. They also have plans for an 80k sq.ft. format in Columbus, OH to test smaller metros. While they occupy a challenging sector in a tough economy, they’re making rational moves to mitigate risk where possible, and appear to learn from their mistakes. If they can maintain store design quality and maintain focus on customer service, stores could prove to be the game changer they needed to solidify their DTC business.
The piece I would add feels like it hides behind the growth number – Wayfair does not sell furniture, it moves it. And big, heavy, damage-prone freight is the most expensive category in retail to deliver and to return. Every point of growth (virtually) runs through that cost.
Two factors make the next few quarters harder than the headline. First, customers now expect Amazon-style speed and convenience on oversized goods, and stretching to meet that on furniture drives elevated returns, which are the most expensive miles in the network. Order counts up while average order value came in light at $332. More orders at a lower ticket in heavy freight squeezes margin – either your freight cost as a percentage of revenue needs to decrease by increased average order value, or overall cost per delivery needs to keep falling. That, more so than demand, is the real question for 2026 and 2027.
Second, the housing market. Big and bulky last-mile demand is tightly linked to home sales, and with turnover at a 30-year low, that whole delivery segment has seen its growth cut roughly in half. Fewer moves could mean less furniture bought.
Wayfair has a promising future. I say that as a satisfied customer. Desks, a desk chair, an area rug, bathroom cabinets and fixtures for a remodel. I would reeeaaallly prefer buying furniture in person. But a dearth of local stores means that’s just not an option. And Wayfair’s breadth of assortment and value equation has proved to be the real thing. Several purchases, all good quality, zero returns. Did I mention broad assortments? I’m not usually a fan of assortment breadth, but here I am as a customer voting with my wallet. At a minimum, Wayfair is a go-to for the discovery process. They are going to have a version of what you are looking for for your home.
The real question is whether Wayfair is winning share or inheriting demand by default. National furniture chains collapsed, department stores abandoned the category, and Wayfair filled the vacuum. That fills the void, but inherited customers carry shallow loyalty. They arrived because alternatives disappeared, not because Wayfair earned deep preference. That distinction matters when Amazon, IKEA, and mass merchants keep sharpening their home furnishings game. With Perigold growing 35% while overall average order value comes in light, it means the core business is seeing real ticket erosion. Profitability is improving, but more orders at lower tickets in heavy freight puts structural pressure on that progress. Growth has always been Wayfair’s priority over loyalty. In infrequent purchase categories, that eventually becomes a vulnerability.
Capturing displaced demand is still a competitive share gain: consumers of failed chains don’t default to Wayfair automatically, they have to choose it over one of many other places they can buy furnishings. In any case, from our tracking Wayfair has (only) captured about 19% of spend from retailers that have failed over the past year. That’s equivalent to around 1.6 percentage points of its US growth this quarter, leaving 7.1 percentage points attributable to share capture from existing players or organic growth from consumers spending more.
Perigold’s growth is impressive, but it remains a very small part of the mix (c$400 million a year). It is nowhere near large enough to conceal AOV declines in the rest of the business. By our calculations, AOV in the core business is up modestly.
I am no particular fan of Wayfair and am generally critical of the economics of their business model, but this was a solid quarter for them in terms of the top line.
Wayfair’s next phase of growth cannot depend only on the home category recovering. The company already has scale and selection, but home is still a low-frequency category where customers may not return for months after one large purchase.
The opportunity is to give customers reasons to come back between big projects. That could mean using stores to help shoppers compare sofas, visualization tools to plan a room, or curated ideas that turn a single furniture purchase into follow-on purchases for rugs, lighting, storage, and decor.
Wayfair does not just need more assortment. It needs more moments where customers see it as useful before they are ready to buy. That is what will matter most as customer demand normalizes.
Beyond gaining operational efficiencies, Wayfair has adapted to retail bifurcation. Wayfair’s assortment accommodates the different needs of both value shoppers and luxury buyers. Perigold attracts upscale shoppers and commands a premium, so it’s smart for Wayfair to invest in building this brand.
More Discussions
Reconsidering the Role of the Retail Store: Are Shoppers Tired of ‘Feeling Predicted’?
What do you think of JLL’s survey results?How Much Should TJX Worry About its Recent US Sales Performance?
It’s well-known that TJX Companies has enjoyed great success over the past few years, often delivering…What Do Recent Labor Day Surveys Tell Us About the Current State of the American Consumer?
What are your takeaways from recent survey data around expected Labor Day spend?
Over the past half year, Wayfair has taken market share. The priority now is twofold. First, to keep the strong growth going. Second, to get the bottom line into the black. Achieving the former will help with the latter as it aids productivity and produces leverage. However, growth will become progressively more difficult as the benefit of tax refunds fades and Wayfair laps tougher prior year numbers. New store openings – which add to sales and also lift online revenue in their catchment – will only help marginally. The profit side of the equation relies on cutting further costs (especially marketing) and continuing to repay debt – both of those things will be a long slog.
Wayfair has always been willing to spend aggressively on advertising, and in a category with long purchase cycles, that visibility compounds over time. The market share gains from brick and mortar suggests it’s paying off, even in a tough environment for home goods.
I should expect they will continue what they are doing…and why not? Home furnishings is a curious industry: the national (e.g. Levitz) and regional (Breuners, Barker Bros, et al) chains that we remember from childhood have disappeared, and the product(s) increasingly are absent from department stores. So where do folks buy furniture? At companies like Wayfair, it seems.
Physical stores are the key reason for Wayfair’s growing profitability and success. After opening their Chicago flagship, Illinois sales overall were 15% above Wayfair’s national average, with a 35% increase in high consideration purchases like appliances and bathroom renos. More importantly, over 50% of in-store customers across all their current stores are net new to the brand. This means stores are driving new customer acquisition, in addition to the halo effect of lifting sales in each surrounding geographic area.
And unlike most DTC brands, Wayfair was cautious with physical growth. Only after testing pop-ups and partner spaces did they realize it wasn’t possible to convey their brand value in limited spaces. Today they’re being strategic in their store locations, and quick to alter store designs and merch plans to suit each local community. They also have plans for an 80k sq.ft. format in Columbus, OH to test smaller metros. While they occupy a challenging sector in a tough economy, they’re making rational moves to mitigate risk where possible, and appear to learn from their mistakes. If they can maintain store design quality and maintain focus on customer service, stores could prove to be the game changer they needed to solidify their DTC business.
The piece I would add feels like it hides behind the growth number – Wayfair does not sell furniture, it moves it. And big, heavy, damage-prone freight is the most expensive category in retail to deliver and to return. Every point of growth (virtually) runs through that cost.
Two factors make the next few quarters harder than the headline. First, customers now expect Amazon-style speed and convenience on oversized goods, and stretching to meet that on furniture drives elevated returns, which are the most expensive miles in the network. Order counts up while average order value came in light at $332. More orders at a lower ticket in heavy freight squeezes margin – either your freight cost as a percentage of revenue needs to decrease by increased average order value, or overall cost per delivery needs to keep falling. That, more so than demand, is the real question for 2026 and 2027.
Second, the housing market. Big and bulky last-mile demand is tightly linked to home sales, and with turnover at a 30-year low, that whole delivery segment has seen its growth cut roughly in half. Fewer moves could mean less furniture bought.
Wayfair has a promising future. I say that as a satisfied customer. Desks, a desk chair, an area rug, bathroom cabinets and fixtures for a remodel. I would reeeaaallly prefer buying furniture in person. But a dearth of local stores means that’s just not an option. And Wayfair’s breadth of assortment and value equation has proved to be the real thing. Several purchases, all good quality, zero returns. Did I mention broad assortments? I’m not usually a fan of assortment breadth, but here I am as a customer voting with my wallet. At a minimum, Wayfair is a go-to for the discovery process. They are going to have a version of what you are looking for for your home.
The real question is whether Wayfair is winning share or inheriting demand by default. National furniture chains collapsed, department stores abandoned the category, and Wayfair filled the vacuum. That fills the void, but inherited customers carry shallow loyalty. They arrived because alternatives disappeared, not because Wayfair earned deep preference. That distinction matters when Amazon, IKEA, and mass merchants keep sharpening their home furnishings game. With Perigold growing 35% while overall average order value comes in light, it means the core business is seeing real ticket erosion. Profitability is improving, but more orders at lower tickets in heavy freight puts structural pressure on that progress. Growth has always been Wayfair’s priority over loyalty. In infrequent purchase categories, that eventually becomes a vulnerability.
Capturing displaced demand is still a competitive share gain: consumers of failed chains don’t default to Wayfair automatically, they have to choose it over one of many other places they can buy furnishings. In any case, from our tracking Wayfair has (only) captured about 19% of spend from retailers that have failed over the past year. That’s equivalent to around 1.6 percentage points of its US growth this quarter, leaving 7.1 percentage points attributable to share capture from existing players or organic growth from consumers spending more.
Perigold’s growth is impressive, but it remains a very small part of the mix (c$400 million a year). It is nowhere near large enough to conceal AOV declines in the rest of the business. By our calculations, AOV in the core business is up modestly.
I am no particular fan of Wayfair and am generally critical of the economics of their business model, but this was a solid quarter for them in terms of the top line.
Wayfair’s next phase of growth cannot depend only on the home category recovering. The company already has scale and selection, but home is still a low-frequency category where customers may not return for months after one large purchase.
The opportunity is to give customers reasons to come back between big projects. That could mean using stores to help shoppers compare sofas, visualization tools to plan a room, or curated ideas that turn a single furniture purchase into follow-on purchases for rugs, lighting, storage, and decor.
Wayfair does not just need more assortment. It needs more moments where customers see it as useful before they are ready to buy. That is what will matter most as customer demand normalizes.
Beyond gaining operational efficiencies, Wayfair has adapted to retail bifurcation. Wayfair’s assortment accommodates the different needs of both value shoppers and luxury buyers. Perigold attracts upscale shoppers and commands a premium, so it’s smart for Wayfair to invest in building this brand.