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Wednesday, January 20, 2021

Pier 1’s online competitor Wayfair has rough quarter

Shares of online furniture retailer Wayfair Inc. plunged on Friday after the company reported a bigger than expected loss. Investors are questioning how Wayfair, which has yet to have a profitable quarter, will ever make money. Wayfair reported a loss of $330.2 million in the fourth quarter, compared with a loss of $143.8 million in the same period a year earlier. That’s despite the company’s revenue growing by nearly 26% from a year

earlier. The loss was much more than what analysts had expected. Wayfair has expanded aggressively and spent heavily on online advertising in order to lure new customers. The company recently announced some modest layoffs, roughly 3% of its workforce. Like other Internet retailers, investors have soured on Wayfair’s business model in the past year. The stock was already down 50% this year before Friday’s drop.

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