Dive Brief:
- Warby Parker on Monday reported first quarter net revenue reached $153.2 million, a 10.3% increase from last year and nearly 18% increase from the same period in 2019. The company lost about $15 million in sales due to disruptions caused by the Omicron variant at the start of the year.
- The DTC eyewear brand grew its active customer base by 18% year over year to 2.23 million, according to a company press release. Average revenue per customer increased 11.2% from the year-ago period to $249.
- Warby Parker’s losses widened from last year. The brand’s operating loss reached $33.7 million from a profit of $3 million last year. Selling, general and administrative expenses reached $123.4 million, driven by a $25.9 million increase in stock-based compensation expense and related employer payroll taxes.
Dive Insight:
Despite topping revenue from last year and even pre-pandemic, Warby Parker continues to struggle to turn a profit.
The DTC eyewear brand's net loss reached $34.1 million from an income of $3 million in the year-ago period.
The problem surrounding profitability has been one faced by many DTC brands, with many turning to physical stores to help offset the high costs associated with acquiring and retaining customers solely online.
For Warby Parker, the brand opened eight new stores in the first quarter alone, bringing its total to just under 170 stores. By the end of the year, the brand aims to operate around 200 locations.
“Despite a challenging macroeconomic backdrop, we continue to grow faster than others in our industry,” co-CEO Neil Blumenthal said in a statement. "We believe our omnichannel business model, compelling value proposition, and strong consumer brand uniquely position us to capture market share for years to come in both good and turbulent environments.”
During the period, Warby Parker also expanded its eye exam capacity, launched four eyewear collections and scaled its vertically-integrated supply chain, according to co-CEO Dave Gilboa. The company also said it doubled revenue in its contact lens business during Q1.
Warby Parker reiterated its outlook for the full fiscal year, expecting net revenue to grow up to 22%, reaching between $650 million and $660 million, which includes about $15 million in lost sales related to disruptions caused by the Omicron variant. The retailer also expects adjusted EBITDA margin between 5.6% and 6.6%.
