Slide 1: Second Quarter 2023 Earnings Report
SECOND QUARTER 2023 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, 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: Warby Parker at a glance
1. Since 2010, we’ve offered high-quality prescription eyewear—designed in-house—starting at $95 and delivered industry-leading customer experiences 2. Our sales represent less than 1% of the $76 billion U.S. eyewear market 3. We helped pioneer the vertically integrated, direct-to-consumer model 4. W
Slide 5: Q2 2023 key metrics
$166.1M 11.0% 2.28M $14.2M 8.5% $277 (1) Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP measures. See the appendix for reconciliations to the nearest GAAP measures. (2) Defined as net revenue for the trailing twelve-month period divided by the number of Active Customers as of the end of that
Slide 6: Bradley Fair (Wichita, KS) MarketStreet (Lynnfield, MA)
Bradley Fair (Wichita, KS) MarketStreet (Lynnfield, MA)
Slide 7: Net revenue growth of 11.0% vs. Q2'22
$166.1 $149.6 $131.6 ● Q2’23 net revenue growth of 11.0% vs. Q2’22 96.0% 13.7% 11.0% ● Average revenue per customer up 9.2% to $277 2,076 2,258 2,285 ● Opened 13 new stores in Q2’23, ending the $235 $254 $277 quarter with 217 stores 145 178 217 $302.8 $338.1 $270.5 ● June YTD 2023 net revenue growth
Slide 8: Adjusted EBITDA margin of 8.5%, adjusted gross margin and SG&A
$14.2 $10.8 $5.9 ● Adjusted EBITDA margin(1) of 8.5%, up 4.5 pts from Q2’22 8.2% 8.5% 4.0% ● Adjusted gross margin(1) was 54.7% compared to 57.9% in Q2’22, primarily driven by increased penetration of contacts and continued retail expansion 59.3% 57.9% 54.7% ● Adjusted SG&A(1) as a percent of revenu
Slide 9: Net revenue, Adjusted EBITDA, active customers and revenue per customer
$149.6 $166.1 $131.6 2,258 2,285 2,076 96.0% 19.8% 13.7% 11.0% 8.8% 1.2% $14.2 $277 $10.8 $254 $235 $5.9 8.2% 4.0% 8.5% 11.5% 9.2% 8.1% Adjusted EBITDA and Adjusted EBITDA Margin % are non-GAAP measures. See the appendix for reconciliations to the nearest GAAP metrics.
Slide 10: Quarterly net revenue, Adjusted EBITDA and store count trends
$172.0 $166.1 $17.7 $153.2 $149.6 $148.8 $14.2 $146.5 $11.9 $8.6 $5.9 $0.8 10.3% 13.7% 10.2% 12.2% 11.0% 0.5% 4.0% 8.0% 5.8% 10.3% 8.5% 8.3% 217 $277 204 $258 $263 $270 190 200 $249 $254 169 178 11.3% 8.2% 6.8% 6.9% 8.4% 9.2% Adjusted EBITDA and Adjusted EBITDA Margin % are non-GAAP measures. See th
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Slide 12: Retail store footprint and potential
900+ 217 open retail stores 217 212 U.S. and 5 Canada 73 markets 41 states/provinces 159 cities Current Potential 19 new retail stores in 2023 footprint footprint Store presence in 47 of the 50 most populous markets in the U.S. Location types: ~34% street, ~41% outdoor center, ~25% indoor center As
Slide 13: Clay Terrace (Carmel, CA)
Clay Terrace (Carmel, CA)
Slide 14: Q3 and full year 2023 guidance
$655–664M ~$52M 9.5–11.0% 7.9% 9.5–11.0% 5–6%
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Slide 17: Supplemental Details
S U P P L E M E N TA L D E TA I L S
Slide 18: Net revenue by quarter (2017 - Q2 2023)
Net revenue in bars ($M) 2017 Average = $52M NET REVENUE BY QUARTER (2017 - Q2 2023) 2018 2019 $67 Average = $93M Bestags= 90M Average = $135M Q117 Q2'17 Q3%7 Q4'17 118 Q218 G38 Q448 Q119 219 Q319 Q419 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 G2'22 Q3'22 Q4'22 Q1'23 Q2'23 % of Year 25%
Slide 19: Customer cohort sales retention
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. (2) 24 month r
Slide 20: Appendix
APPENDIX
Slide 21: 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 22: Adjusted EBITDA reconciliation
($15,925) ($32,166) ($26,737) ($66,299) (2,281) 38 (4,160) (108) (24) 47 237 586 9,284 7,694 18,424 14,605 255 186 650 412 18,164 26,867 38,030 54,244 600 3,270 600 3,270 463 - 826 - 3,639 - 4,042 - $14,175 $5,936 $31,912 $6,710 8.5% 4.0% 9.4% 2.2% (1) Represents expenses related to the Company’s eq
Slide 23: 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 24: Quarterly Adjusted EBITDA reconciliation
$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) ($10,812) ($15,925) (613) (889) (58) (379) 49 496 81 (529) (134) 440 146 (105) (146) 38 183 (1,382) (1,878) (2,281) 998 410 154 (1,288) 189 93 196 (287) 144
Slide 25: 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:
Slide 26: Thank you
THANK YOU