Wayfair Inc at JPMorgan Global Technology, Media and Communications Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Christopher Horvers - JPMorgan - Analyst : So I have a series of questions with about 15 minutes left, we'll go to audience questions as well. And there's some -- you can also post online for those who are listening online. So setting the stage and kicking it off at a high level. Over the past three years, there's been a significant amount of change at Wayfair. The strategy has pivoted from growth to profitable growth. You've exited Germany, you're opening stores. Can you talk about what drove that change? And how you think about the strategy going forward?

Question: Christopher Horvers - JPMorgan - Analyst : And so just thinking about maybe this is a good point to just think about the long-term algorithm of business. A couple of years ago, you set out some profitability targets. You set out a gross margin target. Can you expand on that a little bit and help us think about sort of what sort of backdrop is necessary to ultimately enable getting to those targets?

Question: Christopher Horvers - JPMorgan - Analyst : That's great. And just to clarify, the mid-teens incremental that's on SOTG&A?

Question: Christopher Horvers - JPMorgan - Analyst : Got it. There's always the question of your structural strengths and weaknesses versus a competitor like Amazon and now Walmart is adding a lot of SKUs, mostly in apparel, but a healthy amount of the home furnishing side as well. So can you talk about -- because I know you get this question a lot, what are the structural advantages that Wayfair has against these very scaled competitors?

Question: Christopher Horvers - JPMorgan - Analyst : Absolutely. It's a very -- shipping large items that are subject to damage, it's a very, very...

Question: Christopher Horvers - JPMorgan - Analyst : Complex business. Maybe before we go to some consumer questions, as you think about the self-help growth drivers that you have going forward, could you maybe talk about like near, medium and long term, how you think about those opportunities to drive share?

Question: Christopher Horvers - JPMorgan - Analyst : Great. That's a big number for a state.

Question: Christopher Horvers - JPMorgan - Analyst : Maybe talk about -- there's a lot heading towards tariffs. There's a lot of questions on the consumer right now, what is going on with the consumer, what happened in the post-holiday lull period. How much was weather, how much is -- what's going on? Is there a pull forward of demand? So maybe you could just brush broad strokes across all those questions, which I'm sure you've heard a lot today.

Question: Christopher Horvers - JPMorgan - Analyst : And then other retailers have talked about pull forward of demand in different categories, and it does seem like it did touch the home more than other parts of the consumer wallet. Can you talk about what you've observed from a category from pull forward of demand perspective?

Question: Christopher Horvers - JPMorgan - Analyst : Other retailers I follow in this space have talked about raising price ahead of cost already, the branded retailers. What are you seeing on the price side and dovetailed this to like the marketplace.

Question: Christopher Horvers - JPMorgan - Analyst : Concern out there and how tariffs might affect your business?

Question: Christopher Horvers - JPMorgan - Analyst : And you have not seen -- so you have not seen any notable price...?

Question: Christopher Horvers - JPMorgan - Analyst : So I just think about historically, what's been inflation like in the category? And I'm not sure if you know this exactly, but AOVs did pick up in the back half of the year. What would you say inflation was for you in 2024?

Question: Christopher Horvers - JPMorgan - Analyst : And so as you think about -- how did you think about the rest of the year. You had a bunch of vendors move a lot of inventory into the US across a bunch of different categories. That certainly affected your business. As you look forward, how do you think this plays out? We have a 90-day window. Retailers are going to rush product into this country. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 7:10PM, W.N - Wayfair Inc at JPMorgan Global Technology, Media and Communications Conference So are there any implications to that for your business, whether share or margins? And then to the extent that let's say that it just stays at 30% forever from China. How does that affect you and your competitive set versus -- maybe versus the 145, maybe the 145 is not the right reference point. So maybe it's just the 30.

Question: Christopher Horvers - JPMorgan - Analyst : Are there any questions from the audience? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 7:10PM, W.N - Wayfair Inc at JPMorgan Global Technology, Media and Communications Conference Unidentified Participant I was hoping you could talk a bit about Way Day this year and the extended sales period and how Way Day performed this year versus last year. And could you just talk a bit about just housing fundamentals and how they're impacting your business?

Question: Christopher Horvers - JPMorgan - Analyst : Peel the eyes out of the back of the head.

Question: Christopher Horvers - JPMorgan - Analyst : Do you get -- there's a question in the back. Unidentified Participant So you had 40 million orders last year. What percentage of them were serviced through CastleGate? And how do you see that number going forward? And if I may, on your active customer count, that continued to come down. How do you plan on making it go higher? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 7:10PM, W.N - Wayfair Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Christopher Horvers - JPMorgan - Analyst : I think is that time?

Question: Christopher Horvers - JPMorgan - Analyst : Thank you so much, everybody, Thanks, Kate.