Warby Parker Looks to Open 40 Stores in 2024, Launch More Higher-priced Collections
Warby Parker Inc. wants to hit the accelerator on sales this year — but investors are waiting to see just how much oomph the eyeglass company has.
Warby Parker’s fourth-quarter losses narrowed slightly to $19 million from $20.3 million a year earlier. The company added $800,000 to its adjusted earnings before interest, taxes, depreciation and amortization, which hit $9.4 million. Adjusted EBITDA margins were flat at 5.8 percent.
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Revenues for the quarter ended Dec. 31 rose 10.5 percent to $161.9 million.
For all of 2023, revenues rose 12 percent to $669.8 million as adjusted EBITDA margins came in at 7.8 percent.
Dave Gilboa, cofounder, co-chief executive officer and co-chairman, told analysts on a conference call: “We are pleased to have achieved a full year of positive free cash flow while we continue to make significant investments in our long-term strategic initiatives, including opening 40 new stores, scaling contacts and eye exam to approximately 9 percent and 4 percent of revenue, respectively, and introducing new innovative products like precision progressives.”
That marked Warby Parker’s second full year as a public company.
As with many of the other vintage 2021 IPOs — including Allbirds Inc., Rent the Runway Inc. and a host of others — it’s been a tough run in the market that is now being complicated by some consumer uncertainty.
Investors traded shares of Warby Parker down 15 percent to $12.79 — far from the stock’s peak at more than $58 a share in November 2021.
But Gilboa said the company is pushing to keep getting bigger.
“We’re not content,” he said on the call. “We have higher ambitions, in particular for top-line growth and for serving more customers while maintaining operational discipline and expanding profitability. A focus for 2024 and beyond will be to improve our top line growth rate, and we are pleased with the positive momentum we have seen so far year-to-date.”
While Warby Parker got its start online — and is still growing e-commerce — it has also become a very bricks-and-mortar retailer with 230 stores.
“Our stores serve as billboards and act as efficient customer acquisition vehicles,” Gilboa said. “And we believe the 40 openings that we have planned this year will also help drive awareness. To amplify our retail channel, we plan to allocate a portion of our media budget towards driving local store awareness and store traffic in a more intentional manner than in prior years. These efforts include expanding exam awareness to drive exam utilization as well.”
The brand also plans to push on higher-end frames, while maintaining its roots.
Neil Blumenthal, cofounder, co-CEO and co-chairman, added: “Since launching Warby Parker in 2010, we’ve intentionally maintained our core $95 price point. Our simple, affordable pricing structure has been an integral part of our value proposition, and we believe it continues to attract new customers. And while we’ll continue to expand our $95 offering, we plan to launch nearly 20 collections this year, many of which will incorporate our $145, our $175 and our $195 price point while introducing innovative frame constructions, new land types, sizes and more.”
For 2024, Warby Parker is looking for revenues to grow by 12 to 13 percent to a range of $748 million to $758 million. Adjusted EBITDA margins are seen increasing to 8.9 percent if revenues hit the midpoint of that guidance.
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