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Wayfair (W) is soaring to new multi-year highs today after delivering its Q3 results this morning. The e-commerce home furnishings company handily beat EPS expectations, while revenue accelerated, increasing 8.1% yr/yr to $3.18 bln, well ahead of expectations. The company's model continues to benefit in the current environment, with suppliers competing to win share and keeping prices low for consumers.

• Orders grew 5% yr/yr with two straight quarters of mid-single-digit new order growth; U.S. revenue +9% and international +5%. Active customers fell 2.3% yr/yr to 21.2 mln, but returned to sequential growth for the first time since 2023.
• Importantly, management cleared the air on growth quality, it is structural, not tariff driven. Only short-lived blips in large appliances and vanities were seen, neither impacting aggregate results materially.
• While not relying on a housing rebound, management sees category trends stabilizing, with years of double-digit declines giving way to near-flat performance in FY25 and offering a more supportive backdrop even as macro conditions remain soft.
• Looking ahead, management is upbeat on holiday trends and sees AI advancements driving further share gains. W plans to resume annual guidance, and expects FY26 adjusted EBITDA to grow faster than revenue as profitability continues to scale.

Briefing.com Analyst Insight

This is another sharp move higher for W on the heels of a well-received report. Q2 was already a standout, and Q3 delivered the strongest third-quarter sequential growth since 2019. That came even as the housing backdrop remains soft, though management noted signs that the category is sort of bottoming out. Just as important, they put questions about tariff pull-forward to rest, with growth structurally driven. With new AI enhancements around the corner and a more supportive demand environment emerging, Wayfair seems well positioned to keep building on its current momentum.