Warby Parker Inc. · NYSE:WRBY
Warby Parker — Q4 2022 Earnings Presentation
36 slides from Warby Parker's earnings presentation, Feb 28, 2023
Slide 1: Q4 and Full-Year 2022 Earnings Report
Q4 AND FULL-YEAR 2022 EARNINGS REPORT Speakers: DAVE GILBOA | Co-Founder & Co-CEO NEIL BLUMENTHAL | Co-Founder & Co-CEO STEVE MILLER | SVP & Chief Financial Officer
Slide 2: Forward-looking statements
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may relate to, but are not limited to, expectations of future operating results or fi
Slide 3: Since our founding, we've pioneered ideas, designed products, and developed technologies
SINCE OUR F O U N D I N G, W E ’ V E P I O N E E R E D I D E AS, D E S I G N E D P R O D U C T S, A N D D E V E LO P E D T E C H N O LO G I E S T H AT H E L P P E O P L E S E E.
Slide 4: Our sales represent less than 1% of the $76 billion U.S. eyewear market
1. Our sales represent less than 1% of the $76 billion U.S. eyewear market 2. We maintain a best-in-class NPS of 80(1), with low unaided brand awareness of less than 15% 3. We helped pioneer the vertically integrated, direct-to-consumer model 4. Warby Parker has 200 stores(2) out of 48,000 optical s
Slide 5: Full-year 2022 key metrics
$598M 10.6% 2.28M $263 80 200 $27.2M 4.5% (1) Defined as net revenue for the trailing twelve-month period divided by the number of Active Customers as of the end of that same period. (2) Net Promoter Score is calculated on a trailing twelve-month basis weighted for the number of responses received. (
Slide 6: 2022 accomplishments
Grew active customer base to 2.28 million Launched 20 collections Opened 40 stores, reaching 200 in fleet Scaled eye exams to 150 locations Expanded contacts and progressives penetration Celebrated 10M pairs of glasses distributed through our Buy a Pair, Give a Pair program
Slide 7: Garden City Center (Cranston, RI) One Loudoun (Ashburn, VA)
Garden City Center (Cranston, RI) One Loudoun (Ashburn, VA)
Slide 8: Slide 8
Slide 9: Net revenue and Active Customers
$132.9 $146.5 $112.8 ● Q4’22 net revenue growth of 10.2% vs. Q4’21 and up 16.1% on a 3-year CAGR basis vs. Q4’19 20.5% 17.8% 10.2% 28.5% 23.4% 16.1% ● Active Customers as of Q4’22 at 2.28M, an 1.81 2.20 2.28 increase of 78K Active Customers, or 3.6%, y/y $218 $246 $263 vs. Q4’21 126 161 200 ● Opened
Slide 10: Adjusted EBITDA and margins
$8.6 $1.1 ($6.4) 5.8% ● Adjusted EBITDA margin(1) of 5.8%, up 10.6 pts from Q4’21 0.9% (4.8%) ● Adjusted gross margin(1) was 55.2% compared to 57.5% in Q4’21, primarily driven by increased penetration of contacts reflecting strategy to grow contact lens offering 57.8% 57.5% 55.2% ● Adjusted SG&A(1) at
Slide 11: Annual net revenue and Adjusted EBITDA trends
$598.1 $540.8 2.20 2.28 $393.7 1.81 37.4% 6.3% 10.6% 21.5% 3.6% 1.5% $27.2 $246 $263 $24.9 $218 12.8% $7.7 4.6% 4.5% 4.7% 6.9% 1.9% Adjusted EBITDA and Adjusted EBITDA Margin % are non-GAAP measures. See the appendix for reconciliations to the nearest GAAP metrics.
Slide 12: Quarterly net revenue, Adjusted EBITDA and store productivity
$153.2 $149.6 $148.8 $10.8 $11.2 $11.9 $146.5 $9.3 $8.6 $139.0 $131.6 $137.4 $132.9 $5.9 6.7% 8.2% 8.1% $0.8 4.0% 8.0% 5.8% (4.8%) 0.5% 96% 27% 32% 18% 10% 14% 10% ($6.4) 8% 190 200 161 169 178 145 154 134 88% 88% 84% 82% 81% Adjusted EBITDA and Adjusted EBITDA Margin % are non-GAAP measures. See th
Slide 13: Current footprint and potential
900+ 200 open retail stores 200 195 U.S. and 5 Canada 66 markets 39 states/provinces 142 cities Current Potential 40 new retail stores in 2022 footprint footprint Store presence in 47 of the 50 most populous markets in the U.S. Location types: ~37% street, ~37% outdoor center, ~26% indoor center As
Slide 14: Andersonville (Chicago, IL)
Andersonville (Chicago, IL)
Slide 15: Union Square (New York, NY)
Union Square (New York, NY) Exterior Union Square (New York, NY) Interior
Slide 16: Hyde Park Village (Tampa, FL)
Hyde Park Village (Tampa, FL)
Slide 17: Optical lab in Sloatsburg, NY and Las Vegas, NV
Optical lab in Sloatsburg, NY Optical lab in Las Vegas, NV
Slide 18: 2023 strategic priorities
SCALING OUR EXPANDING OUR EVOLVING INTO A DRIVING BRAND OMNICHANNEL CORE GLASSES HOLISTIC VISION AWARENESS EXPERIENCE BUSINESS CARE COMPANY Open 40 stores to end Launch nearly 20 Scale contacts business Amplify reach by utilizing the year with 240 collections strategic mix of organic Grow eye exam b
Slide 19: 2023 guidance
$645–660M ~$51.5M 8–10% ~7.9% 7–9% 8.0–9.0%
Slide 20: Village Pointe (Omaha, NE)
N if Fa Le | ae Village Pointe (Omaha, NE)
Slide 21: uA WARB
uA WARB A FICER? PAL ICET? WABREY WAR ARHELE? PA TARER? Hiner Ware ARBY Us PA Ct? PAF:
Slide 22: Virtual Vision Test
Virtual Vision Test Y y’
Slide 23: One Loudoun (Ashburn, VA) Morningside Heights (New York, NY)
One Loudoun (Ashburn, VA) Morningside Heights (New York, NY)
Slide 24: Supplemental Details
S U P P L E M E N TA L D E TA I L S
Slide 25: Net revenue by quarter (2016-2022)
Net revenue in bars ($M) 2017 427% $53 51 $53 ° $53 | Average = $52M Qt17 Q247 Q3'17 Q4"17 NET REVENUE BY QUARTER (2016 - 2022) 2019 2018 Average = $93M Pavone sean 118 248 Q318 2448 AM9 219 A319 2419 @1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 04°21 2020 Average = $135M Average = $98M 2022 Q1'22 Q2'2
Slide 26: Customer cohort sales retention
(1) Source: Company data Note: Sales retention based on customer cohort sales order value and months since initial purchase. (1) 2019 cohort was impacted by onset and continuation of COVID pandemic in 2020 and 2021, which is reflected in that cohort’s retention rate after 12 and 24 months.
Slide 27: Holistic offering customers have higher cumulative value
Customers who purchase holistic offering (glasses, contacts, and exams) have a cumulative average value1 that is 2x higher after one year than customers who just purchase glasses (and 1.5x higher at initial purchase) Source: Company data. Holistic Vision Customers in 2021 cohort represent just 0.8% o
Slide 28: Appendix
APPENDIX
Slide 29: Non-GAAP financial measures
Included in this presentation are certain financial measures that are not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”) and which are designed to supplement, and not substitute, the Company’s financial information presented in accordance with GAAP. The non-GAAP m
Slide 30: Adjusted EBITDA reconciliation
($20,251) ($45,902) ($110,393) ($144,271) (1,382) (105) (1,307) 347 (77) 112 497 263 8,919 6,370 31,864 21,643 138 180 1,647 317 20,052 32,946 98,655 110,543 500 - 3,770 7,757 - - - 28,262 151 - 247 - 518 - 687 - - - 1,535 - $8,568 ($6,399) $27,202 $24,861 5.8% (4.8%) 4.5% 4.6% (1) Represents expens
Slide 31: Supplemental Financial Information
S U P P L E M E N TA L F I N A N C I A L I N F O R M AT I O N
Slide 32: Gross margin and SG&A reconciliation
$65,842 $56,641 $65,647 $56,418 $257,050 $233,049 $256,145 $221,904 44.9% 42.6% 44.8% 42.5% 43.0% 41.2% 42.8% 41.0% $80,651 $76,251 $80,846 $76,474 $341,062 $317,749 $341,967 $318,894 55.1% 57.4% 55.2% 57.5% 57.0% 58.8% 57.2% 59.0% $102,361 $122,146 $81,486 $89,423 $452,265 $461,410 $348,523 $315,99
Slide 33: Quarterly Adjusted EBITDA reconciliation
($15,865) $2,141 ($253) ($8,900) $6,425 $4,050 $1,383 ($11,856) $2,778 ($12,786) ($41,612) ($4,301) $3,011 ($10,307) ($91,073) ($45,902) ($34,133) ($32,166) ($23,843) ($20,251) (79) (329) (536) (429) (613) (889) (58) (379) 49 496 81 (529) (134) 440 146 (105) (146) 38 183 (1,382) 59 59 59 62 998 410
Slide 34: Reconciliation of Non-GAAP Measures
R E C O N C I L I AT I O N O F N O N - G A A P M E A S U R E S The following table reflects a reconciliation of each non-GAAP, or adjusted, financial measure to its most directly comparable financial measure prepared in accordance with GAAP: 27
Slide 35: Reconciliation of Non-GAAP Measures
R E C O N C I L I AT I O N O F N O N - G A A P M E A S U R E S
Slide 36: Thank You
THANK YOU