In the complex world of global trade, in which tariffs are now clouding the outlook, Wayfair (W), an online home goods retailer, is navigating challenges with steady confidence. Despite persistent category volatility that showed a fourth consecutive year beginning with contraction, the latest earnings show Wayfair managed to increase market share and improve profitability.

Although the stock is down 3.5% year-to-date, the outlook remains far from gloomy. Morgan Stanley analyst Simeon Gutman maintains a “Buy” rating with a price target of $72, signaling that Wall Street still trusts Wayfair’s long-term prospects.

About Wayfair Stock

Wayfair (W) is a major player in the online home goods market. With a market cap of $5.4 billion, the company offers furniture and home decor through its flagship site Wayfair.com and four additional brands: Joss & Main, AllModern, Birch Lane, and Perigold.

Over the past month, W stock has gained 37%. The upward trend accelerated on May 12, when the stock jumped 20.7% following a key upgrade from Argus Research. Analyst John Staszak upgraded the stock from “Hold” to “Buy,” signaling stronger confidence in the company’s growth prospects and strategic execution.

Wayfair Surpasses Q1 Earnings

On May 1, Wayfair unveiled its Q1 earnings for 2025, outpacing Wall Street’s cautious estimates. Its revenue remained flat at $2.73 billion, nudging past the anticipated $2.71 billion. While the top line held mostly steady, the company faced headwinds abroad. 

Exiting the German market dealt a blow to its international segment, dragging it down by 10.9%. Yet, the U.S. operations served as a silver lining, posting 1.6% growth compared to the same period last year.

More encouraging was Wayfair’s adjusted EBITDA, which surged by 41.3% to $106 million. The net loss also shrank 54.4% to $113 million. Adjusted EPS told an even brighter story, clocking in at $0.10, a sharp turnaround from the adjusted loss per share of $0.32 a year prior, comfortably beating the expected loss of $0.18 per share.

Wayfair closed the quarter with $1.4 billion in cash and equivalents and $1.8 billion of overall liquidity. Management pointed to a notable shift: suppliers are ramping up their ad spend, with a 40% year-over-year jump in vendors investing at least 100 basis points of their revenue into advertising. 

The transition underscores Wayfair’s evolution from a simple retail platform to a powerful marketing engine, where high-margin ad dollars can significantly boost profitability.

Looking ahead, management guidance for Q2 2025 suggests gross margins will hover between 30% and 31%, likely leaning toward the lower end, consistent with last year’s latter half. Adjusted EBITDA margins are expected between 4% and 5%. 

What Do Analysts Expect for Wayfair Stock?

W stock carries a “Moderate Buy” overall rating. Out of 31 analysts weighing in, 14 ring the bell with a “Strong Buy,” while two lean toward a “Moderate Buy.” At the same time, 14 remain cautious with a “Hold” rating, and a lone analyst waves a “Strong Hold” flag. 

The average price target of $44.47 represents minimal upside potential, while the Street-high target of $72 suggests the stock can gain more than 68% from here.