• Net Revenue: $192.4 million, 13.3% growth year over year.

• Adjusted EBITDA: $17.3 million, 9% margin, 250 basis points expansion.

• Active Customers: 2.4 million, 5.6% increase on a trailing 12-month basis.

• Average Revenue per Customer: $305, up 7.5% year over year.

• Retail Revenue Growth: Approximately 20% year over year.

• E-commerce Revenue Growth: Approximately 1% year over year.

• Gross Margin: 54.6%, down 13 basis points year over year.

• Store Count: 269 stores, 42 net new stores added over the last 12 months.

• Contact Lens Sales: Grew approximately 35% year over year.

• Eye Exams Revenue: Grew approximately 40% year over year.

• Free Cash Flow: Positive for the sixth consecutive quarter, $13 million in Q3.

• Cash Position: Approximately $251 million.

• Full Year Revenue Guidance: $765 million to $768 million, 14% to 15% growth.

• Full Year Adjusted EBITDA Guidance: Approximately $73 million.

• Warning! GuruFocus has detected 3 Warning Sign with WRBY.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Warby Parker Inc (NYSE:WRBY) reported Q3 net revenue of $192.4 million, marking a 13.3% year-over-year growth, surpassing their guidance.

• The company experienced its highest active customer growth of the year, ending Q3 with 2.4 million active customers, a 5.6% increase on a trailing 12-month basis.

• Retail revenue increased by approximately 20% year-over-year, driven by new store growth and consistent performance within existing stores.

• Warby Parker Inc (NYSE:WRBY) raised its full-year guidance, now expecting 14% to 15% revenue growth and approximately $73 million in adjusted EBITDA.

• The company continues to see positive momentum in its glasses business, with glasses sales growing approximately 10% year-over-year in Q3.

Negative Points

• E-commerce revenue only increased by approximately 1% year-over-year, reflecting challenges in the channel despite overall positive momentum.

• Gross margin slightly decreased by 13 basis points year-over-year to 54.6%, impacted by increased occupancy expenses and strategic investments in optometrists.

• The company faces ongoing challenges with tariffs, as approximately 20% of its cost of goods sold is still sourced from China.

• Despite strong growth in contact lens sales, they remain below the industry average, representing only 11% of revenue compared to the 20% industry average.

• Warby Parker Inc (NYSE:WRBY) continues to experience lower gross margins in its contact lenses and eye exams segments, which, while accretive to gross profit dollars, have a lower margin profile than eyeglasses.