Wayfair NYSE:W, an online furniture and home goods retailer, is expanding its physical store strategy at a difficult point for the furniture market, as high mortgage rates and weaker home improvement spending continue to weigh on demand. The company plans to open a large showroom in Denver by the end of the year, followed by additional stores in Cincinnati, Ohio; Yonkers, New York; Fort Lauderdale, Florida; and Princeton, New Jersey in 2027. These locations would add to Wayfair's existing flagship stores in Chicago, Atlanta and Columbus, Ohio, suggesting management may be positioning the business for a potential recovery in a cyclical category.
Chief Financial Officer Kate Gulliver said furniture demand could eventually come back because consumers still need basic home products such as beds and seating, and she noted that Wayfair wants to meet shoppers offline if that is where they choose to buy. Early signs appear to support the company's broader turnaround effort, with Wayfair reporting in April a fourth consecutive quarter of positive sales growth after six straight quarters of flat or declining revenue. Revenue is expected to rise more than 5% in the second quarter from a year earlier, based on Bloomberg-compiled estimates, which would outpace the broader US home furnishings market.
Investors may view the store expansion as a potentially meaningful but execution-heavy bet, because Wayfair is moving beyond the pure e-commerce model it relied on for roughly its first 20 years. Its Chicago store, opened in 2024, found that more than 50% of shoppers making purchases in the first year were new customers, while its $29-a-year Wayfair Rewards program had members accounting for more than 15% of US revenue by the end of 2025. The company says its showroom model may reduce some upfront risk because store inventory is still owned by its 20,000 global suppliers, although Wayfair will still need to build new capabilities in retail staffing and in selecting which products from its vast online catalog belong inside stores.