Is Wayfair in Trouble? — Market Mad House

Wayfair Inc. (NYSE: W) one of the few online retail success stories outside of Amazon (NASDAQ: AMZN) could be in trouble.

In fact, Wayfair laid-off 550 employees or 3% of its workforce on 13 February 2020, USA Today reports. The layoffs are part of Wayfair’s attempt to cut costs by streamlining its operations.

It is easy to see why Wayfair is laying off people. Wayfair reported a -$305.42 million quarterly operating loss on 31 December 2019. Wayfair’s operating loss rose during each quarter in 2019. For instance, Wayfair reported a -$129.60 million quarterly operating loss in 31 December 2018 and -$259.71 million quarterly operating loss on 30 September 2019.

Wayfair Grows and Loses Money

Strangely, Wayfair is growing and losing money at the same time. For instance, Wayfair reported a quarterly revenue growth rate of 25.79% on 31 December 2019.

However, Wayfair reported a quarterly net common loss of -$330.22 million on 31 December 2019. Moreover, Wayfair reported a negative operating cash flow of -$36.30 million, a negative investing cash flow of -$675.66 million, and a negative financing cash flow of -$70,000 on 31 December 2019.

Consequently, Wayfair had a negative ending cash flow of -$712.63 million on 31 December 2019…