Warby Parker (WRBY) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $192.4 million, up 13.3% year-over-year, with adjusted EBITDA margin expanding to 9.0% and net loss narrowing to $4.1 million from $17.4 million last year.

• Active customers grew 5.6% to 2.43 million, and average revenue per customer increased 7.5% to $305.

• Store count reached 269, with 13 net new stores opened in Q3 and 228 offering eye exams.

• Strong performance driven by efficient marketing, store expansion, product innovation, and insurance integration.

• Omnichannel strategy fueled growth, with retail revenue up 20% and e-commerce revenue up 1% year-over-year.

Financial highlights

• Adjusted EBITDA for Q3 was $17.3 million (9.0% margin), up from $11.0 million (6.5% margin) last year.

• Gross margin was 54.5% for Q3 2024, nearly flat year-over-year, reflecting investments in optometrists and store expansion.

• Free cash flow for Q3 2024 was $13.1 million, with cash and cash equivalents at $251 million.

• Adjusted SG&A was $100.6 million (52.3% of revenue), with marketing spend at 12.3% of revenue.

• Net loss for Q3 2024 was $4.1 million, a significant improvement from $17.4 million in Q3 2023.

Outlook and guidance

• Full-year 2024 revenue guidance raised to $765–$768 million (14–15% growth), with adjusted EBITDA of ~$73 million (9.5% margin).

• Q4 2024 revenue expected between $184–$187.3 million (14–16% growth), with adjusted EBITDA margin of ~7.3%.

• Gross margin expected to remain stable in the mid-50s% of revenue, with typical seasonal decline in Q4.

• On track to open 40 new stores in 2024.

• Management expects continued investment in retail expansion, technology, and personnel, with operating losses possible as growth initiatives continue.