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Risks Related to Macroeconomic Conditions and Industry Trends
−Removed: Global economic conditions and the effect of economic pressures and other business factors on discretionary consumer spending and consumer preferences may have a material adverse effect on our business, results of operations and financial condition.
+Added: Global economic conditions may have a material adverse effect on our business, results of operations and financial condition.
Uncertainties in global economic conditions that are beyond our control have in the past impacted our business and may in the future materially adversely affect our business, results of operations, financial condition and stock price.
−Removed: These adverse economic conditions include the impacts of the COVID-19 pandemic, inflation, slower growth or recession, new or increased tariffs and other changes to fiscal and monetary policy, higher interest rates, high unemployment, decreased consumer confidence in the economy, armed hostilities, such as the ongoing conflicts between Russia and Ukraine and Israel and Hamas, foreign currency exchange rate fluctuations, conditions affecting the retail environment for products we sell, other matters that influence consumer spending and preferences, and other unexpected events, including public health crises.
−Removed: In addition, consumer confidence and spending can be materially adversely affected in response to financial market volatility, inflationary pressures, negative financial news, conditions in the real estate and mortgage markets, including home equity loans and consumer credit, changes in net worth based on market changes and uncertainty, energy shortages and cost increases, labor and healthcare costs, government actions and general uncertainty regarding the overall future economic environment.
+Added: These adverse conditions include economic instability, changes in tax laws, regulations and new or increased tariffs, including retaliatory tariffs, export controls, the impacts of inflation, slower growth or recession, sustained higher interest rates, high unemployment, decreased consumer confidence in the economy, armed hostilities, such as the ongoing conflicts between Russia and Ukraine, and other events related thereto, such as economic sanctions and trade restrictions, geopolitical tensions in China and other regions, foreign currency exchange rate fluctuations, conditions affecting the retail environment for products we sell, and other unexpected events, including public health crises.
+Added: A downturn in the economic environment can also lead to financial instability, increased credit and collectability risk on our receivables, the failure of important partners, including suppliers, logistics providers, derivative counterparties and other financial institutions, limitations on our ability to issue new debt, reduced liquidity and declines in the fair value of our financial instruments.
+Added: These and other economic factors can materially adversely affect our business, results of operations, financial condition and stock price.
+Added: Changes in consumer confidence and spending due to economic conditions on a global level or in particular markets, geopolitical uncertainty, and other factors may adversely affect our financial performance.
+Added: Our business depends on consumer demand for our products.
+Added: As a result, we believe that our sales are sensitive to a number of factors that influence consumer confidence and spending, both on a global level and in particular markets, that can, in turn, affect our business or the home goods industry generally.
+Added: These factors include, among others, financial market volatility, inflationary pressures, the impacts of tariffs, negative financial news, conditions in the real estate and mortgage markets, including home equity loans and consumer credit, changes in net worth based on market changes and uncertainty, energy shortages and cost increases, labor and healthcare costs, government actions and general uncertainty regarding the overall future economic environment.
Consumers may view a substantial portion of the products we offer as discretionary items rather than necessities.
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Declines in consumer spending have in the past resulted, and in the future may result, in decreased demand for our products and services which may have an adverse effect on our results of operations.
−Removed: A downturn in the economic environment can also lead to financial instability, increased credit and collectability risk on our receivables, the failure of important partners, including suppliers, logistics providers, derivative counterparties and other financial institutions, limitations on our ability to issue new debt, reduced liquidity and declines in the fair value of our financial instruments.
−Removed: These and other economic factors can materially adversely affect our business, results of operations, financial condition and stock price.
+Added: We are subject to risks from changes to the trade policies, including tariff and import/export regulations by the U.S.
+Added: and/or other foreign governments.
+Added: Changes in trade policy, including trade restrictions, new or increased tariffs or quotas, embargoes, sanctions and countersanctions, safeguards or customs restrictions by the U.S.
+Added: and/or other foreign governments could have a material adverse impact on our business.
+Added: The imposition of new tariffs or increases in existing tariffs on products imported from countries where we or our suppliers operate could result in increased costs for finished goods.
+Added: These cost increases may reduce our margins, require us to raise prices, or make our products less competitive in the marketplace.
+Added: In addition, other countries may change their business and trade policies in anticipation of or in response to increased import tariffs and other changes in trade policy and regulations already enacted or that may be enacted in the future.
+Added: If we are unable to mitigate these risks through supply chain adjustments, pricing strategies, or other measures, our financial performance and growth prospects could be negatively affected.
+Added: For example, the U.S.
+Added: has recently imposed new tariffs on China related to the importation of certain product categories, including home goods.
+Added: China has responded with retaliatory tariffs.
+Added: A substantial portion of our products are manufactured in China.
+Added: We are working with our suppliers to mitigate any exposure to current and any other potential tariffs and seeking opportunities to engage with new suppliers outside of China, but there can be no assurance that we will be able to offset any increased costs or secure these new suppliers.
Our results could be adversely affected by events beyond our control, such as natural disasters, public health crises, political crises, negative global climate patterns, or other catastrophic events.
Our operations, or those of our suppliers, could be negatively impacted by various events beyond our control, including, without limitation, natural disasters, such as hurricanes, tornadoes, floods, earthquakes, extreme cold events and other adverse weather conditions;
−Removed: public health crises, such as the COVID-19 pandemic and other pandemics and epidemics;
−Removed: political crises, such as terrorist attacks, war, labor unrest, and other political instability (including, without limitation, the ongoing conflicts between Russia and Ukraine and Israel and Hamas), negative global climate patterns, especially in water stressed regions;
−Removed: or other catastrophic events, such as fires or other disasters occurring at our distribution centers or our suppliers’ manufacturing facilities, whether occurring in the United States or internationally.
+Added: public health crises, such as pandemics and epidemics;
+Added: political crises, such as terrorist attacks, war, labor unrest, and other political instability (including, without limitation, the ongoing conflicts between Russia and Ukraine), negative
+Added: global climate patterns, especially in water stressed regions;
+Added: or other catastrophic events, such as fires or other disasters occurring at our distribution centers or our suppliers’ manufacturing facilities, whether occurring in the U.S.
+Added: or internationally.
These events could disrupt our business operations, including the operations of our corporate offices, physical retail locations, and warehouses, as well as the operations of our global supply chain and those of our third-party partners, including our suppliers, vendors and logistics carriers, and could make it more difficult and costly for us to deliver our products.
−Removed: Although we do not have direct operations in the Middle East, the ongoing conflict between Israel and Hamas and the escalating tensions in the region may disrupt global markets and impact our supply chain, resulting in delays, increased costs, and potential disruptions to the arrival of our products.
−Removed: For example, following the initial conflict between Israel and Hamas, the Houthi movement in Yemen launched a number of attacks on marine vessels traversing the Red Sea causing significant operational disruptions for certain third-party business partners.
−Removed: In addition, these types of events could negatively impact consumer spending in the impacted regions or, depending upon the severity, globally.
−Removed: Disasters occurring at our suppliers’
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−Removed: manufacturing facilities could impact our reputation and customers' perception of the products we offer.
+Added: Furthermore, these types of events could negatively impact consumer spending in the impacted regions or, depending upon the severity, globally.
+Added: Disasters occurring at our suppliers’ manufacturing facilities could impact our reputation and customers' perception of the products we offer.
To the extent any of these events occur, our operations and financial results could be adversely affected.
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If our new hires perform poorly, if we are unsuccessful in hiring, training, managing and integrating these new employees and staff, or if we are not successful in retaining our existing employees and staff, our business may be harmed.
−Removed: Moreover, beginning in 2022 and continuing in 2023, in an effort to reduce our operational costs and improve our organizational efficiency, we implemented a cost efficiency plan, part of which included an internal restructuring and a workforce reduction.
−Removed: Further in January 2024, we implemented a workforce realignment plan to reduce team size across the organization and seniority in certain roles to right-size our cost structure.
+Added: Moreover, beginning in 2022 and continuing in 2023 and 2024, in an effort to reduce our operational costs and improve our organizational efficiency, we implemented a cost efficiency plan, part of which included internal restructurings and workforce reductions to right-size our cost structure.
+Added: Further in January 2025, we announced our decision to exit the German market, including a workforce reduction impacting approximately 730 employees, although we expect approximately half of these positions to relocate to other corporate offices.
Any reduction in force may yield unintended consequences and costs, such as attrition beyond the intended reduction in force, the distraction of employees, reduced employee morale and adverse effects to our reputation as both an employer and with respect to customers, which could make it more difficult for us to hire new employees in the future and to retain and motivate key employees, and there is a risk that we may not achieve the anticipated benefits from the reduction in force.
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Failure to manage our hiring needs effectively or successfully integrate our new hires may have a material adverse effect on our business, financial condition and operating results.
−Removed: Properly managing our growth will also require us to establish consistent policies across regions and functions, and a failure to do so could likewise harm our business.
+Added: Properly managing our global workforce will also require us to establish consistent policies across regions and functions, and a failure to do so could likewise harm our business.
Further, we have a substantial number of hourly employees.
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If we are unable to manage the growth of our organization effectively, our business, financial condition and operating results may be materially adversely affected.
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If we fail to acquire new customers, reactivate prior customers or retain existing customers, or fail to do so in a cost-effective manner, our business, financial condition and operating results could be harmed.
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In order to expand our customer base, we must appeal to and acquire customers who have historically used other means of commerce to purchase home goods and may prefer alternatives to our offerings, such as traditional brick and mortar retailers, the websites of our competitors or our suppliers' own websites.
−Removed: We have made significant investments related to customer acquisition and expect to continue to spend significant amounts to acquire additional customers and to reactivate prior customers.
+Added: We have made significant investments related to customer acquisition and expect to continue to heavily invest to acquire additional customers and to reactivate prior customers.
Our paid advertising efforts consist of television advertising, direct mail, catalog and print advertising, and online channel advertising, including display advertising, paid search advertising, social media advertising, search engine optimization and comparison shopping engine advertising.
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If we are unable to cost-effectively drive traffic to our sites, our ability to acquire new customers, reactivate prior customers or retain our existing customers and our financial condition may suffer.
+Added: We also expect our new loyalty program to attract customers to our stores and to encourage purchases by our customers online.
+Added: Our loyalty program offers customer rewards dollars that can be redeemed on future purchases.
+Added: If we fail to execute the loyalty program, if our customers do not respond positively to the program or if the program costs more than anticipated in reward redemptions, our competitors may be able to attract some of our customers and our financial results could be adversely impacted.
Further, some of our new customers originate from word of mouth or other non-paid referrals from existing customers.
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• maintaining a high-quality and diverse portfolio of products and services;
−Removed: • providing adequate customer service;
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+Added: • providing excellent customer service;
• delivering products on time and without damage;
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Further, the proliferation of social media may increase the likelihood, speed, and magnitude of such negative events.
−Removed: Our aspirations and disclosures related to environmental, social and governance (“ESG”) matters expose us to risks that could adversely affect our reputation and performance.
−Removed: We have established and publicly announced ESG goals, including our commitment to reduce our Scope 1 and 2 GHG emissions by 63% by 2035 in comparison to the 2020 baseline.
+Added: Our aspirations and disclosures related to corporate responsibility matters expose us to risks that could adversely affect our reputation and performance.
+Added: We have established and publicly announced sustainability goals, including our commitment to reduce our Scope 1 and 2 greenhouse gas (“GHG”) emissions by 63% by 2035 compared to a 2020 baseline and our goal to achieve zero waste (90%+ waste diversion from landfill and incineration) across Wayfair operations globally by 2030 .
Such announcements reflect our current plans and aspirations and are not guarantees that we will be able to achieve them.
Our failure to adequately update, accomplish or accurately track and report on these goals on a timely basis, or at all, could adversely affect our reputation, financial performance and growth, and expose us to increased scrutiny from the investment community, special interest groups and enforcement authorities.
−Removed: Our ability to achieve any ESG objective is subject to numerous risks, some of which are outside of our control.
−Removed: Examples of such risks include the availability and cost of low- or non-carbon-based energy sources and low-carbon heating and transportation solutions, the availability of materials and suppliers that meet our sustainability and other ESG goals on our timelines, and competing strategic growth opportunities, such as increasing the scale of our physical retail footprint.
−Removed: Standards for tracking and reporting ESG matters continue to advance and statements about our ESG-related initiatives and progress toward any ESG objective may be based on standards that are still developing, internal controls and processes that continue to evolve, and assumptions that may be subject to change in the future.
−Removed: Our election to publicly report on ESG matters in accordance with voluntary disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or differ from those of others.
−Removed: Methodologies for reporting ESG data may be updated
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−Removed: and previously reported ESG data may be adjusted to reflect improvement in availability and quality of data, changing assumptions, changes in the nature and scope of our operations and other changes in circumstances.
−Removed: Our processes and controls for reporting ESG matters across our operations and supply chain are evolving alongside the multiple disparate standards for identifying, measuring, and reporting ESG metrics, including the standards for ESG-related disclosures that may be required by the SEC, European and other regulators.
−Removed: Such standards may change over time, which could result in significant adjustments to previously reported ESG data, including data regarding our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future.
−Removed: If our ESG practices do not meet evolving investor or other stakeholder expectations and standards, then our reputation or our attractiveness as an investment, business partner, service provider or employer could be negatively impacted.
−Removed: Our newly opened physical retail stores may not achieve sales or operations targets and may negatively impact our financial results.
−Removed: In 2023, we continued our expansion into physical retail with the opening of four new physical retail stores, including two outlet stores.
+Added: Our ability to achieve any sustainability objective is subject to numerous risks, some of which are outside of our control.
+Added: Examples of such risks include the availability and cost of low- or non-carbon-based energy sources and low-carbon building conditioning and transportation solutions, the availability of materials and suppliers that allow us to meet our sustainability goals on our timelines, and competing strategic growth opportunities, such as increasing the scale of our physical retail footprint.
+Added: Standards for tracking and reporting sustainability matters continue to advance and statements about our sustainability-related initiatives and progress toward any sustainability objective may be based on standards that are still developing, internal controls and processes that continue to evolve, and assumptions that may be subject to change in the future.
+Added: Our election to publicly report on sustainability matters in accordance with voluntary disclosure frameworks and standards, and the interpretation or application of those frameworks and standards, may change from time to time or differ from those of others.
+Added: Methodologies for reporting sustainability data may be updated and previously reported sustainability data may be adjusted to reflect improvement in availability and quality of data, changing assumptions, changes in the nature and scope of our operations and other changes in circumstances.
+Added: Our processes and controls for reporting sustainability matters are evolving alongside the multiple disparate standards for identifying, measuring, and reporting sustainability metrics, including the standards for sustainability-related disclosures required by the European Union’s Corporate Sustainability Reporting Directive (“CSRD”) or may be required by the SEC and other regulators.
+Added: The standards used to identify and collect the information and data required pursuant to the CSRD continue to evolve, and this lack of certainty could result in increased compliance costs and a heightened risk of failing to comply with the CSRD, as well as significant adjustments to previously reported sustainability data, including data regarding our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future.
+Added: If our sustainability practices do not meet evolving investor or other stakeholder expectations and standards, then our reputation or our attractiveness as an investment, business partner, service provider or employer could be negatively impacted.
+Added: Our expansion into physical retail stores may not achieve sales or operations targets and may negatively impact our financial results.
+Added: In 2024, we continued our expansion into physical retail with the opening of five new physical retail stores across our family of brands, and two new outlet stores.
We believe that expansion into new physical retail stores represents a growth opportunity for us.
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We may not manage our expansion effectively, and our failure to achieve or properly execute our expansion plans could limit our growth or have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our efforts to expand our business into new brands, channels, products, services, technologies and geographic markets will subject us to additional business, legal, financial and competitive risks and may not be successful.
+Added: Our efforts to expand our business into new brands, channels, products, programs, services, technologies and geographic markets will subject us to additional business, legal, financial and competitive risks and may not be successful.
Our business success depends to some extent on our ability to expand our customer offerings by launching new brands and services and by expanding our existing offerings into new geographic markets from time to time.
−Removed: For example, we launched Decorify in 2023, Wayfair.ie in Ireland in 2022 and the Kelly Clarkson Home Collection in 2020.
−Removed: Launching new brands and services or expanding internationally is time-consuming, requires significant amounts of management time and resources, substantial upfront investments, including investments in marketing, information technology and additional personnel.
+Added: For example, we launched Wayfair Rewards in 2024, Decorify in 2023, Wayfair.ie in Ireland in 2022 and the Kelly Clarkson Home Collection in 2020.
+Added: Launching new brands, programs and services or expanding internationally is time-consuming, requires significant amounts of management time and resources, substantial upfront investments, including investments in marketing, information technology and additional personnel.
Expanding our brands internationally is particularly challenging because it requires us to gain country-specific knowledge about consumers, regional competitors and local laws, construct catalogs specific to the country, build local logistics capabilities and customize portions of our technology for local markets.
We may not be able to generate satisfactory net revenue from these efforts to offset these costs.
−Removed: Any lack of market acceptance of our efforts to launch new brands and services or to expand our existing offerings could have a material adverse effect on our business, prospects, financial condition and operating results.
−Removed: Further, as we continue to expand our fulfillment capability or add new businesses with different requirements, our logistics networks become increasingly complex and operating them becomes more challenging.
+Added: Any lack of market acceptance of our efforts to launch new brands, programs and services or to expand our existing offerings could have a material adverse effect on our business, prospects, financial condition and operating results.
+Added: For example, in October 2024, we introduced Wayfair Rewards, a new loyalty program that provides a range of benefits to members in return for payment of an annual membership fee.
+Added: Wayfair Rewards is new to our business and has not been tested prior to its introduction.
+Added: Given that this type of loyalty program is new and untested, there can be no certainty as to exactly how our customers may react to the program over time or how the Wayfair Rewards’ rollout will affect our financial results from quarter to quarter.
+Added: Further, as we continue to expand our fulfillment capability or add new businesses with different
+Added: requirements, our logistics networks become increasingly complex and operating them becomes more challenging.
There can be no assurance that we will be able to operate our networks effectively.
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If this occurs, our business, financial condition and operating results may be materially adversely affected.
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+Added: Implementation of our key strategic initiatives, including our technology transformation, expansion into physical retail and the continued expansion of our proprietary logistics network, require significant capital expenditures.
+Added: A lack of available capital resources due to business performance or other financial commitments could prevent or delay the deployment of innovations in our business.
+Added: We may reduce capital expenditures significantly or seek additional financing or issue additional securities, which may affect the timing and scope of growth strategy.
+Added: We cannot be certain that we will be able to obtain new financing on favorable terms, or at all.
Our international operations subject us to various additional legal, regulatory, financial and other risks.
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Expanding our international operations to grow our business will require significant management attention and resources and expose us to additional risks.
−Removed: As we expand, we also become subject to certain laws, including the Foreign Corrupt Practices Act, as well as the laws of the foreign countries in which we operate, which may impose new or changing regulatory restrictions and requirements, including in the areas of data privacy and sustainability.
+Added: As we continue to expand our operations to other countries, we will also become subject to certain domestic laws, including the Foreign Corrupt Practices Act, as well as the laws of the foreign countries in which we operate, which may impose new or changing regulatory restrictions and requirements, including in the areas of data privacy and sustainability.
Violations of these laws could subject us to actions from government regulatory authorities, including sanctions, import restrictions, and tariffs (including anti-dumping and countervailing duties), or other penalties that could have an adverse effect on our reputation, operating results and financial condition.
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Additionally, global events as well as geopolitical developments, including military conflicts in Ukraine and the Middle East, fluctuating commodity prices, trade tariff developments and inflation have caused, and may in the future cause, global economic uncertainty and uncertainty about the interest rate environment, which has recently and could continue to amplify the volatility of currency fluctuations.
−Removed: To date, we have not entered into any currency hedging contracts.
+Added: have not entered into any currency hedging contracts.
As a result, we may not be able to effectively offset the adverse financial impacts that may result from unfavorable movements in foreign currency exchange rates, and therefore fluctuations in foreign exchange rates could significantly impact our financial results.
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Furthermore, if our future growth and operating performance fail to meet investor or analyst expectations, or if we have future negative cash flow or losses resulting from our investment in acquiring new customers, our financial condition and stock price could be materially adversely affected.
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System interruptions that impair customer access to our sites or other performance failures or incidents involving our logistics network, our technology infrastructure or our critical technology partners could damage our business, reputation and brand and substantially harm our business and results of operations.
−Removed: The satisfactory performance, reliability and availability of our sites, transaction processing systems, logistics network and technology infrastructure are critical to our reputation and our ability to acquire and retain customers, as well as maintain adequate customer service levels.
+Added: The satisfactory performance, reliability, integrity and availability of our sites, transaction processing systems, logistics network and technology infrastructure are critical to our reputation and our ability to acquire and retain customers, as well as maintain adequate customer service levels.
For example, if our cloud provider fails or suffers an interruption or degradation of services, we could lose customer data and miss order fulfillment deadlines, which could harm our business.
−Removed: Our systems and operations, including our ability to fulfill customer orders through our logistics network, are also vulnerable to damage or interruption from inclement weather, fire, flood, power loss, telecommunications failure, terrorist attacks, labor disputes, cyber-attacks, data loss, acts of war, break-ins, other physical security threats, earthquake and similar events.
+Added: Our systems and operations, including our ability to fulfill customer orders through our logistics network, are also vulnerable to damage or interruption from inclement weather, fire, flood, power loss, telecommunications failure, terrorist attacks, labor disputes, cyber-attacks, data loss, acts of war, break-ins, other physical security threats, earthquakes and similar events.
In the event of a system outage or degradation, the failover to another site or a back-up could take substantial time, during which time our sites could be completely shut down.
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Accordingly, we redesign and enhance various functions on our sites on a regular basis, and we may experience instability and performance issues as a result of these changes.
−Removed: Any slowdown, interruption or performance failure of our sites and the underlying technology and logistics infrastructure could harm our business, reputation and our ability to acquire, retain and serve our customers, which could materially adversely affect our results of operations.
+Added: Any slowdown, interruption or performance failure of our sites and the underlying technology and logistics infrastructure could harm our business, reputation and our ability to acquire, retain and serve our customers, which could materially adversely
+Added: affect our results of operations.
Our disaster recovery plan may be inadequate, and our business interruption insurance may not be sufficient to compensate us for the losses that could occur.
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Given this, along with our inability to rapidly switch our Google Cloud operations to another cloud provider, any disruption of or interference with our use of Google Cloud or any widespread disruption in Google Cloud itself would impact our operations and our business would be adversely affected.
−Removed: In addition, if hosting costs increase over time, or we are unable to optimize our applications for a cloud environment, or we require more computing or
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−Removed: storage capacity, our costs could increase disproportionately.
+Added: In addition, if hosting costs increase over time, or we are unable to optimize our applications for a cloud environment, or we require more computing or storage capacity, our costs could increase disproportionately.
If we are unable to grow our revenues faster than the cost of utilizing the services of Google or similar providers, our business and financial condition could be adversely affected.
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Like many businesses, despite all of our efforts to defend against cyber threats and respond to incidents, we, and our third party service providers, have in the past and will in the future continue to be subject to cyber-attacks, cybersecurity threats and attempts to compromise and penetrate our data security systems and disrupt our operations.
−Removed: Recent cybersecurity incidents impacting large institutions, including those resulting in the compromise of sensitive data and the disruption of critical systems, suggest that the risk of such cyber events is significant, even when reasonable measures to protect the confidentiality, integrity, and availability of information are implemented.
−Removed: This may be as a result of deliberate malicious attempts to infiltrate our systems, including but not limited to, state-sponsored attackers or cybercriminal efforts, zero-day vulnerabilities, phishing attacks, software supply chain compromises, or non-malicious factors, including but not limited to, disruptions during the process of upgrading or replacing computer software or hardware, errors by the vendors we rely upon, or other disruptions that may jeopardize the security of our assets or information.
+Added: Cybersecurity incidents impacting large institutions, including those resulting in the compromise of sensitive data and the disruption of critical systems, suggest that the risk of such cyber events is significant, even when reasonable measures to protect the confidentiality, integrity, and availability of information are implemented.
+Added: This may be as a result of deliberate malicious attempts to infiltrate our systems, including but not limited to, state-sponsored attackers or cybercriminal efforts such as ransomware attacks, zero-day vulnerabilities, phishing attacks, software supply chain compromises, or non-malicious factors, including but not limited to, disruptions during the process of upgrading or replacing computer software or hardware, errors by the vendors we rely upon, or other disruptions that may jeopardize the security of our assets or information.
We and our service providers may not anticipate, detect, or prevent all types of attacks until after they have already been launched, particularly because the techniques used to obtain unauthorized access are increasingly sophisticated, constantly evolving and may not be known in the market.
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engagement of third party experts and consultants;
−Removed: loss, litigation or regulatory action and other potential liabilities.
−Removed: Any compromise or breach of our security measures, or those of our third-party service providers, could violate applicable privacy, data security and other laws and regulations, and cause significant legal and financial exposure, adverse publicity and a loss of confidence in our security measures, which could have a material adverse effect on our business, financial condition and operating results.
+Added: loss, litigation (including class action litigation) or regulatory action and other potential liabilities.
+Added: Any compromise or breach of our security measures, or those of our third-party service providers, could violate applicable privacy, data security and other laws and regulations, and cause significant legal and financial exposure, adverse publicity and a loss of confidence in our security measures, which could have a material adverse effect
+Added: on our business, financial condition and operating results.
Our reputation and brand could be damaged, our business may suffer, and we could be required to expend significant capital and other resources to alleviate problems caused by such incidents.
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See Part I, Item 1C, Cybersecurity , in this Annual Report on Form 10-K for more information regarding our cybersecurity risk management, strategy, and governance.
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Our failure to operate effectively in a highly competitive and evolving industry could have a material adverse effect on our business.
−Removed: Our business is rapidly evolving and intensely competitive, with numerous competitors including furniture stores, big box retailers, department stores, specialty retailers and online retailers and marketplaces in the U.S., Canada, the United Kingdom, Ireland and Germany, including those listed in Part I, Item 1, Business .
+Added: Our business is rapidly evolving and intensely competitive, with numerous competitors including furniture stores, big box retailers, department stores, specialty retailers and online retailers and marketplaces in the U.S., Canada, the United Kingdom, and Ireland, including those listed in Part I, Item 1, Business .
We expect competition in e-commerce generally to continue to increase.
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• our ability to distribute our products and manage our operations;
+Added: • our ability to effectively utilize technological advancements, including artificial intelligence;
• our reputation and brand strength.
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• our reputation and brand strength.
−Removed: In addition, if we do not have a clear and relevant promotional calendar to engage our customers, especially in the current macroeconomic environment, our customers may purchase fewer goods from us or we may have to increase our promotional
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+Added: In addition, if we do not have a clear and relevant promotional calendar to engage our customers, especially in the current macroeconomic environment, our customers may purchase fewer goods from us or we may have to increase our promotional activities.
If the shopping experience we provide does not appeal to consumers or meet the expectations of existing customers, we may not acquire new customers at sustainable rates, acquired customers may not become repeat customers and existing customers’ buying patterns and levels may decrease.
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For example, while we experienced increased sales and order activity at times during the COVID-19 pandemic, the pandemic significantly disrupted the global supply chain, including many of our suppliers due to factory closures, raw material and labor inflation and risks of labor shortages, among other things.
−Removed: Additionally, although we do not have direct operations in the Middle East, the ongoing conflict between Israel and Hamas and the escalating tensions in the region may impact our supply chain.
Any ongoing or future disruptions could materially and adversely affect our suppliers’ ability to provide products in a timely manner, or at all, which may materially and adversely affect our business, financial condition and operating results.
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We are also subject to risks of fraud from our suppliers.
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We also are unable to predict whether any of the countries in which our suppliers’ products are currently manufactured or may be manufactured in the future will be subject to new, different, or additional trade restrictions imposed by the U.S.
or foreign governments or the likelihood, type or effect of any such restrictions.
−Removed: Any event causing a disruption or delay of imports from suppliers with international manufacturing operations, including the imposition of additional import restrictions, restrictions on the transfer of funds or increased tariffs or quotas, could increase the cost or reduce the supply of merchandise available to our customers and materially adversely affect our financial performance as well as our reputation and brand.
−Removed: Furthermore, some or all of our suppliers’ foreign operations may be adversely affected by political and financial instability, including, without limitation, the military conflicts in Ukraine and the Middle East, as well as other unexpected events, including public health crises resulting in the disruption of trade from exporting countries, restrictions on the transfer of funds or other trade disruptions.
+Added: Significant portions of the merchandise we source are manufactured outside of the U.S., and any event causing a disruption or delay of imports from suppliers with international manufacturing operations, including the imposition of increased tariffs or quotas, additional import restrictions, or restrictions on the transfer of funds, could increase the cost or reduce the supply of merchandise available to our customers and materially adversely affect our financial performance as well as our reputation and brand.
+Added: For example, the U.S.
+Added: has recently imposed new tariffs on China related to the importation of certain product categories and the U.S.
+Added: has proposed additional tariffs on goods shipped from China, including the home goods category.
+Added: China has responded with retaliatory tariffs.
+Added: These tariffs will likely increase the cost of our products and negatively impact our operating results.
+Added: Although we are currently seeking opportunities to engage additional suppliers outside of China, there can be no assurance that we will be able to offset any increased costs or secure any additional suppliers outside of China.
+Added: Additionally, the availability of certain products could be affected if suppliers choose to limit their exposure to U.S.
+Added: markets in response to unfavorable trade policies, and we may be unable to source alternatives quickly enough to avoid interruptions in product supply.
In addition, with respect to our business with foreign suppliers, particularly for our international sites, we have in the past and may in the future be affected by changes in the value of the U.S.
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Additionally, we primarily rely on a single carrier, FedEx, for the delivery of our small parcel products, and third party national, regional and local transportation companies deliver a portion of our large parcel products, including through our Wayfair Delivery Network.
−Removed: Our ability to efficiently ship products to customers may be negatively affected by factors beyond our and our carriers’ control, including inclement weather, natural disasters, system interruptions and technology failures, labor activism, supply chain issues, including congestion and delays, labor inflation and increased costs, political instability, military conflicts, health pandemics and epidemics or bioterrorism.
−Removed: For example, following the initial conflict between Israel and Hamas in the Middle East, the Houthi movement in Yemen, launched a number of attacks on marine vessels traversing the Red Sea causing significant operational disruptions for certain third-party business partners.
−Removed: The conflict is ongoing, and should it escalate or expand, it could result in delays, increased costs, and potential disruptions to the arrival of our products.
−Removed: We are also subject to risks of breakage or other damage during delivery by any of these third parties.
+Added: Our ability to efficiently ship products to customers has been and may be in the future negatively affected by factors beyond our and our carriers’ control, which may include inclement weather, natural disasters, system interruptions and technology failures, labor activism, supply chain issues, including congestion and delays, labor inflation and increased costs, political instability, military conflicts, health pandemics and epidemics or bioterrorism.
We also use and rely on other services from third parties, such as cloud computing services, telecommunications services, customs, consolidation and shipping services, as well as warranty, installation, assembly and design services.
−Removed: We may be unable to maintain these relationships, and these services may also be subject to outages and interruptions that are not within our control.
−Removed: For example, failures by our telecommunications providers have in the past and may in the future interrupt our ability to provide phone support to our customers.
−Removed: Third parties may
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−Removed: in the future determine they no longer wish to do business with us or may decide to take other actions that could harm our business.
+Added: We may be unable to maintain these relationships, and these services have been in the past and may also be in the future subject to outages and interruptions that are not within our control.
+Added: Third parties may in the future determine they no longer wish to do business with us or may decide to take other actions that could harm our business.
We may also determine that we no longer want to do business with them.
−Removed: If products are not delivered in a timely fashion or are damaged during the delivery process, or if we are not able to provide adequate customer support or other services or offerings, our customers could become dissatisfied and cease buying products through our sites, which would adversely affect our operating results.
+Added: If products are not delivered in a timely fashion or are damaged during the delivery process by any of our third party transportation companies, or if we are not able to provide adequate customer support or other services or offerings, our customers could become dissatisfied and cease buying products through our sites, which would adversely affect our operating results.
If our internal control over financial reporting or our disclosure controls and procedures are not effective, we may not be able to accurately report our financial results, prevent fraud or file our periodic reports in a timely manner, which may cause investors to lose confidence in our reported financial information and may lead to a decline in our stock price.
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If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses, the market price of our stock would likely decline and we could be subject to lawsuits, sanctions or investigations by regulatory authorities, including SEC enforcement actions, and we could be required to restate our financial results, any of which would require additional financial and management resources.
−Removed: We continue to invest in more robust technology and resources to manage those reporting requirements.
+Added: We continue to invest in more robust technology and resources to manage reporting requirements.
+Added: For example, in the first quarter of 2024, we transitioned to our new financial accounting system for financial reporting which is designed to enhance the flow of financial information, improve data management and provide both accurate and timely financial reporting.
Implementing the appropriate changes to our internal controls may distract our officers and employees, result in substantial costs and require significant time to complete.
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Our business is also affected by economic and business conditions globally, including inflation, slower growth or recession, new or increased tariffs and other changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment, consumer confidence in the economy, consumer debt levels, energy prices, and currency fluctuations.
−Removed: Additionally, the volatile and uncertain macroeconomic environment that we have experienced since the onset of the COVID-19 pandemic has likely reduced, and may continue to reduce, our ability to forecast our future financial and operating results.
As a result, forecasted financial and operating results may differ materially from actual results, which may materially adversely affect our financial condition and stock price.
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These assumptions are inherently difficult to predict, particularly in the long term.
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We generally state possible outcomes as high and low ranges which are intended to provide a sensitivity analysis as variables are changed but are not intended to imply that actual results could not fall outside of the suggested ranges.
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Any such system, site or service interruptions could prevent us from efficiently receiving or fulfilling orders, which may reduce the volume or quality of goods or services we sell and may cause customer dissatisfaction and harm our reputation and brand.
−Removed: Our business may be adversely affected if we are unable to provide our customers a cost-effective shopping platform that is able to respond and adapt to rapid changes in technology.
+Added: Our business may be adversely affected if we are unable to respond and adapt to rapid changes in technology.
The number of people who access the Internet through devices other than personal computers, including mobile phones, smartphones, smartwatches, handheld computers such as notebooks and tablets, video game consoles and television set-top devices, has increased dramatically in the past few years.
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Further, in the event that it is more difficult or less compelling for our customers to buy products from us on their mobile or other devices, or if our customers choose not to buy products from us on such devices or to use mobile or other products that do not offer access to our sites or limit the effectiveness of our marketing or other offerings, our customer growth could be harmed and our business, financial condition and operating results may be materially adversely affected.
−Removed: Limitations on the availability of capital and reductions to capital expenditures may delay or prevent deployment of strategic initiatives.
−Removed: Implementation of our key strategic initiatives, including our technology transformation, expansion into physical retail and the continued expansion of our proprietary logistics network, require significant capital expenditures.
−Removed: A lack of available capital resources due to business performance or other financial commitments could prevent or delay the deployment of innovations in our business.
−Removed: We may reduce capital expenditures significantly or seek additional financing or issue additional securities, which may affect the timing and scope of growth strategy.
−Removed: We cannot be certain that we will be able to obtain new financing on favorable terms, or at all.
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+Added: Additionally, our competitors may outpace us in incorporating new technologies, such as artificial intelligence, into their product offerings and engagement with customers, which could affect our competitiveness and operational outcomes.
+Added: Our efforts to utilize these technological advancements may not be successful, may result in substantial integration and maintenance costs, and may expose us to additional risks.
+Added: The content, analyses, or recommendations generated by artificial intelligence programs, if deficient, inaccurate, or biased, could adversely impact our business, financial condition, and operational results, as well as our
+Added: Moreover, ethical concerns associated with artificial intelligence could lead to brand damage, competitive disadvantages or legal repercussions.
+Added: Any problems with our implementation or use of artificial intelligence or other technological advancements could negatively impact our business or results of our operations.
Significant merchandise returns could harm our business.
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We rely on third parties to provide many of these payment methods and payment processing services, including certain Wayfair-branded programs and promotional financing.
−Removed: If we offer new payment options to consumers, we may be subject to additional regulations, compliance requirements and fraud.
+Added: If we offer new payment options to consumers, we may be subject to additional regulations, compliance requirements and payment fraud.
Additionally, changes to existing laws and regulations or their interpretation, or the adoption of new laws or regulations could require mandatory changes to our payment options.
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As our business changes, we may also be subject to different rules under existing standards, which may require new assessments that involve costs above what we currently pay for compliance.
−Removed: If we fail to comply with the rules or requirements of any provider of a payment method we accept, if the volume of fraud in our transactions limits or terminates our rights to use payment methods we currently accept, or if a data breach occurs relating to our payment systems, we may, among other things, be subject to fines or higher transaction fees and may lose, or face restrictions placed upon, our ability to accept credit card and debit card payments from consumers or to facilitate other types of online payments.
+Added: If we fail to comply with the rules or requirements of any provider of a payment method we accept, if the volume of fraud in our transactions limits or terminates our rights to use payment methods we currently accept, or if a data breach occurs relating to our payment systems, we may, among other things, be subject to fines or higher transaction fees and may lose, or face restrictions placed upon, our ability to accept credit card and debit card payments from consumers or to
+Added: facilitate other types of online payments.
If any of these events were to occur, our business, financial condition and operating results could be materially adversely affected.
We occasionally receive orders placed with fraudulent credit card data.
−Removed: We have in the past, and may in the future, suffer losses as a result of orders placed with fraudulent credit card data even if the associated financial institution approved payment of
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+Added: We have in the past, and may in the future, suffer losses as a result of orders placed with fraudulent credit card data even if the associated financial institution approved payment of the orders.
Under current credit card practices, we may be liable for fraudulent credit card transactions.
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Our future success also depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees, particularly mid-level managers, engineers and merchandising and technology personnel.
−Removed: We have recently implemented workforce reductions and may in the future implement other reductions in force.
−Removed: For example, in January 2024, as part of our cost efficiency plan, we reduced our workforce by approximately 1,650 employees.
−Removed: As a result of this workforce reduction, we expect to incur approximately $70 million and $80 million of costs, consisting primarily of employee severance and benefit costs.
−Removed: Any reduction in force may yield unintended consequences and costs, such as the loss of institutional knowledge, relationships and expertise for certain critical roles, attrition beyond the intended reduction in force, the distraction of employees, reduced employee morale and adverse effects to our reputation as an employer, which could make it more difficult for us to hire new employees in the future, and the risk that we may not achieve the anticipated benefits from the reduction in workforce.
+Added: we have implemented reorganizations and workforce reductions and may in the future implement other reorganizations or reductions in force.
+Added: For example, in January 2025, we announced our decision to exit the German market, impacting approximately 730 employees, although we expect approximately half of these positions to relocate to other corporate offices.
+Added: Any reorganization or reduction in force may yield unintended consequences and costs, such as the loss of institutional knowledge, relationships and expertise for certain critical roles, attrition beyond the intended plan, the distraction of employees, reduced employee morale and adverse effects to our reputation as an employer, which could make it more difficult for us to hire new employees in the future, and the risk that we may not achieve the anticipated benefits from the process.
The market for such positions in the Boston area and other cities in which we operate is competitive.
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Any of these events may materially adversely affect our business, financial condition and operating results.
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We may not be able to adequately protect our intellectual property rights.
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or internationally for all of our intellectual property, and we might not be able to obtain effective intellectual property protection in every country in which we sell products or perform services.
−Removed: For example, we are the registrant of marks for our brands in numerous jurisdictions and of the Internet domain name for the websites of Wayfair.com, Wayfair.ca, Wayfair.co.uk, Wayfair.de and Wayfair.ie and our other sites, as well as various related domain names.
+Added: For example, we are the registrant of marks for our brands in numerous jurisdictions and of the Internet domain name for our websites at Wayfair.com, Wayfair.ca, Wayfair.co.uk, and Wayfair.ie and our other sites, as well as various related domain names.
However, we have not registered our marks or domain names in all major international jurisdictions and may not be able to register or use such domain names in all of the countries in which we currently or intend to conduct business.
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Alternatively, we may be required to develop non-infringing technology or intellectual property, which could require significant effort and expense and may ultimately not be successful.
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We have received in the past, and we may receive in the future, communications alleging that certain items posted on or sold through our sites violate third-party copyrights, designs, marks and trade names or other intellectual property rights or other proprietary rights.
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These risks have been amplified by the increase in third parties whose sole or primary business is to assert such claims.
−Removed: We are engaged in legal proceedings that could cause us to incur unforeseen expenses and could occupy a significant amount of our management's time and attention.
+Added: We are engaged in legal proceedings from time to time that could cause us to incur unforeseen expenses and could occupy a significant amount of our management's time and attention.
From time to time, we are subject to litigation or claims that could negatively affect our business operations and financial position.
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In addition, the amount, timing, and execution of our Repurchase Programs may fluctuate based on our priorities for the use of cash for other purposes, and because of changes in cash flows, tax laws, and the market price of our Class A common stock, the Repurchase Programs could diminish our cash reserves.
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Risks Related to our Indebtedness and Capital Raising
Our outstanding indebtedness, or additional indebtedness that we may incur, could limit our operating flexibility and adversely affect our financial condition.
−Removed: As of December 31, 2023, we had $3.2 billion of principal indebtedness outstandin g, $117 million of w hich is characterized as short-term debt and presented within other current liabilities in the consolidated balance sheets .
−Removed: Our indebtedness includes unsecured 1.125% Convertible Senior Notes due 2024 that mature on November 1, 2024 (the “2024 Notes”), unsecured 0.625% Convertible Senior Notes due 2025 that mature on October 1, 2025 (the “2025 Notes”), unsecured 1.00% Convertible Senior Notes due 2026 that mature on August 15, 2026 (the “2026 Notes”), unsecured 3.25% Convertible Senior Notes due 2027 that mature on September 15, 2027 (the “2027 Notes”), unsecured 3.50% Convertible Senior Notes due 2028 that mature on November 15, 2028 (the “2028 Notes” and together with the 2024 Notes, 2025 Notes, 2026 Notes and the 2027 Notes, the “Non-Accreting Notes”), and unsecured 2.50% Accreting Convertible Senior Notes due 2025 that mature on April 1, 2025 (the “2025 Accreting Notes” and together with the Non-Accreting Notes, the “Notes”).
+Added: As of December 31, 2024, we had $3.2 billion of principal indebtedness outstanding, $236 million of which is characterized as short-term debt and presented within other current liabilities in the consolidated balance sheets.
+Added: Our indebtedness includes unsecured 0.625% Convertible Senior Notes due 2025 that mature on October 1, 2025 (the “2025 Notes”), unsecured 1.00% Convertible Senior Notes due 2026 that mature on August 15, 2026 (the “2026 Notes”), unsecured 3.25% Convertible Senior Notes due 2027 that mature on September 15, 2027 (the “2027 Notes”), unsecured 3.50% Convertible Senior Notes due 2028 that mature on November 15, 2028 (the “2028 Notes”, and together with the 2025 Notes, 2026 Notes and 2027 Notes, the “Non-Accreting Notes”), and 7.250% Senior Secured Notes due 2029 that mature on October 31, 2029 (the “2029 Secured Notes” and together with the Non-Accreting Notes, the “Notes”).
At maturity of the Non-Accreting Notes, unless earlier purchased, redeemed or converted, we will settle any conversions in cash, shares of Wayfair’s Class A common stock or a combination thereof, at our election.
−Removed: At maturity of the Accreting Notes, unless earlier purchased, redeemed or converted, we will settle any conversions in shares of Wayfair's Class A common stock.
−Removed: If any Notes are not converted at or prior to maturity, we will be required to pay the holder thereof the principal amount or, with respect to the 2025 Accreting Notes, the accreted principal amount, in cash.
−Removed: We pay interest semiannually in arrears at fixed rates per annum of 1.125% for the 2024 Notes, 0.625% for the 2025 Notes, 1.00% for the 2026 Notes, 3.25% for the 2027 Notes and 3.50% for the 2028 Notes.
−Removed: The 2025 Accreting Notes accrue interest at a rate of 2.50% per annum, which accretes semiannually to the principal amount.
+Added: If any of the Non-Accreting Notes are not converted at or prior to maturity, we will be required to pay the holder thereof the principal amount in cash.
+Added: At maturity of the 2029 Secured Notes, unless earlier purchased, we will be required to pay the holders thereof the principal amount in cash.
+Added: We pay interest semiannually in arrears at fixed rates per annum of 0.625% for the 2025 Notes, 1.00% for the 2026 Notes, 3.25% for the 2027 Notes, 3.50% for the 2028 Notes and 7.250% for the 2029 Secured Notes.
Under certain circumstances, the holders of the Notes may require us to repay all or a portion of the principal and interest outstanding under the Notes in cash prior to the maturity date, which could have an adverse effect on our liquidity and financial condition.
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We may sell Class A common stock, convertible securities and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time.
−Removed: Our convertible notes are and any future issuance of equity or equity-linked securities would be dilutive to holders of our Class A common stock.
−Removed: New investors in such subsequent transactions could gain rights, preferences and privileges senior to those of holders of our Class A common stock or our convertible notes.
+Added: Our Non-Accreting Notes are and any future issuance of equity or equity-linked securities would be dilutive to holders of our Class A common stock.
+Added: New investors in such subsequent transactions could gain rights, preferences and privileges senior to those of holders of our Class A common stock or our Non-Accreting Notes.
These alternative strategies may not be implemented on satisfactory terms, if at all.
Our ability to refinance our indebtedness or obtain additional financing, or to do so on commercially reasonable terms, may depend on, among other things, our financial condition at the time, our credit rating, restrictions in agreements governing our indebtedness, and other factors, including the condition of the financial markets and the markets in which we compete.
−Removed: Further, we may from time to time seek to retire, restructure, repurchase or redeem, or otherwise mitigate the equity dilution associated with, our outstanding convertible debt, through cash purchases, stock buybacks of some or all of the shares underlying convertible notes, and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise.
+Added: Further, we may from time to time seek to retire, restructure, repurchase or redeem, or otherwise mitigate the equity dilution associated with, our outstanding convertible debt, through cash purchases, stock buybacks of some or all of the shares underlying the Non-Accreting Notes, and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise.
Such repurchases, exchanges or liability management exercises, if any, will be upon such terms and at such prices and sizes as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
The amounts involved may be material.
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Current capital market conditions, including the impact of inflation, have increased borrowing rates and can be expected to significantly increase our cost of capital as compared to prior periods should we seek additional funding.
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We will incur additional costs complying with these additional obligations and any failure or perceived failure to comply would adversely affect our business and reputation.
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−Removed: In addition, there is also uncertainty regarding potential laws, regulations and policies related to ESG, climate change laws and regulations, and global environmental sustainability matters, including disclosure obligations and reporting on such matters.
−Removed: Changes in the legal or regulatory environment affecting ESG, climate change, and sustainability disclosure, responsible sourcing, supply chain transparency, or environmental protection, among others, including regulations to limit carbon dioxide and other greenhouse gas emissions, to discourage the use of plastic or to limit or to impose additional costs on commercial water use may result in increased compliance costs for us and our business partners, all of which may negatively impact our results of operations, financial condition and cash flows.
−Removed: The expectations related to ESG and sustainability matters are rapidly evolving, and from time to time, we announce certain initiatives and goals, related to these matters.
+Added: In addition, there is also uncertainty regarding potential laws, regulations and policies related to sustainability, climate change laws and regulations, and global environmental sustainability matters, including disclosure obligations and reporting on such matters.
+Added: Changes in the legal or regulatory environment affecting sustainability, climate change, and sustainability disclosure, responsible sourcing, supply chain transparency, or environmental protection, among others, including regulations to limit carbon dioxide and other GHG emissions, to discourage the use of plastic or to limit or to impose additional costs on commercial water use may result in increased compliance costs for us and our business partners, all of which may negatively impact our results of operations, financial condition and cash flows.
+Added: The expectations related to sustainability matters are rapidly evolving, and from time to time, we announce certain initiatives and goals related to these matters.
We could fail, or be perceived to fail to act responsibly, in our efforts, or we could fail in accurately reporting our progress on such initiatives and goals.
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We are subject to a variety of federal, state and international privacy laws and regulations that govern the collection, use, retention, sharing, processing, export and security of personal information.
−Removed: New laws and regulations are rapidly coming into effect while existing legislation is rapidly evolving.
−Removed: Among others, we are subject to several global laws, including, but not limited to, the General Data Protection Regulation (“EU GDPR”) in the European Union (“EU”).
−Removed: Following the United Kingdom’s (“U.K.”) withdrawal from the EU, the EU GDPR has been incorporated into U.K.
−Removed: GDPR”), and together with the EU GDPR is referred to herein as “GDPR”).
−Removed: In the U.S., the SEC adopted new rules requiring public companies to disclose information about a material cybersecurity incident, including any breach of personal data, within four business days of determining that it has experienced a material cybersecurity incident.
−Removed: Further, we are subject to various state privacy laws, several of which went into effect in 2023 ( i.e .
−Removed: California, Virginia, Colorado, Connecticut and Utah), and new state privacy laws will come into effect in 2024 ( i.e ., Montana, Oregon and Texas) all of which give new data privacy rights to their respective residents and impose significant obligations on controllers and processors of consumer data.
+Added: New laws and regulations are rapidly coming into effect while existing legislation is continuously evolving.
+Added: Among others, we are subject to several global and state laws, including, but not limited to, the General Data Protection Regulation (“GDPR”) in the European Union (“EU”) and the California Consumer Privacy Act, as amended by the California Privacy Rights Act (“CPRA”), all of which give new data privacy rights to their respective residents and impose significant obligations on controllers and processors of consumer data.
+Added: The SEC adopted new rules requiring public companies to disclose information about a material cybersecurity incident, including any breach of personal data, within four business days of determining that it has experienced a material cybersecurity incident.
The potential effects of these laws, and any other regulations under consideration around the globe, are far-reaching, uncertain, and evolving, and may require us to modify our data processing practices and policies and incur substantial costs and expenses in an effort to comply.
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We may also be contractually required to indemnify and hold harmless third parties from the costs or consequences of non-compliance with any laws, regulations or other legal obligations relating to privacy or consumer protection or any inadvertent or unauthorized use or disclosure of data that we store or handle as part of operating our business.
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If the use of “cookie” tracking technologies is further restricted, regulated, or blocked, or if changes in technology cause cookies to become less reliable or acceptable as a means of tracking consumer behavior, the amount or accuracy of Internet user information we collect would decrease, which could harm our business and operating results.
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and foreign governments have enacted, have considered or are considering legislation or regulations that could significantly restrict the ability of companies and individuals to engage in these activities, such as by regulating the level of consumer notice and consent required before a company can employ cookies or other electronic tracking tools or the use of data gathered with such tools.
−Removed: In the U.S., online tracking technologies are regulated by state privacy laws, such as the California Consumer Privacy Act, federal laws, and self-regulatory frameworks that may be binding on companies that provide online advertising technology services.
+Added: In the U.S., online tracking technologies are regulated by state privacy laws, such as the CPRA, federal laws, and self-regulatory frameworks that may be binding on companies that provide online advertising technology services.
These laws and frameworks may require companies to offer consumers the right to opt out of many of these activities.
Online tracking technologies are regulated in the EU and U.K.
−Removed: via the e-Privacy Directive, which the EU legislature is currently considering updating.
−Removed: Although the new EU regulation is not expected to come into force in the near future, it may restrict the way we conduct online advertising and other online communications.
+Added: via the ePrivacy Directive, which the EU legislature is considering updating via the ePrivacy Regulation (EPR), and the EPR may restrict the way we conduct online advertising and other online communications.
Additionally, some providers of consumer devices and web browsers have implemented, or announced plans to implement, means to make it easier for Internet users to prevent the placement of cookies, to block other tracking technologies or to require new permissions from users for certain activities, which could if widely adopted significantly reduce the effectiveness of such practices and technologies.
−Removed: For example, Google has updated its timetable for restricting the use of third-party cookies in its Chrome browser, consistent with similar actions taken by owners of other browsers.
−Removed: In early 2024, Google began banning third party cookies with the goal of phasing them out by the end of 2024.
+Added: For example, Google previously proposed phasing out third-party cookies in its Chrome browser.
We may have to develop alternative systems, which may be less effective, to analyze our customers’ behavior and preferences, customize their online experience, or efficiently market to them if customers block cookies or regulations introduce additional barriers to collecting cookie data.
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Other new or revised taxes, such as digital taxes, sales taxes, VAT and similar taxes could increase the cost of doing business online and decrease the attractiveness of selling products over the Internet.
−Removed: New taxes and rulings could also
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−Removed: create significant increases in internal costs necessary to capture data and collect and remit taxes.
+Added: New taxes and rulings could also create significant increases in internal costs necessary to capture data and collect and remit taxes.
Any of these events could have a material adverse effect on our business, financial condition and operating results.
−Removed: Our amended and restated certificate of incorporation (“Charter”) generally provides that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions between Wayfair and its stockholders, which could increase costs to bring a claim, discourage claims or limit the ability of the Wayfair’s stockholders to bring a claim in a judicial forum viewed by the stockholders as more favorable for disputes with Wayfair’s directors, officers or other employees.
−Removed: Our Charter provides that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for any (i) derivative action or proceeding brought on behalf of Wayfair;
−Removed: (ii) action asserting a claim for or based on a breach of a fiduciary duty owed by any director, officer or other employee of Wayfair to Wayfair or Wayfair’s stockholders;
−Removed: (iii) action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law (“DGCL”), the Charter, or the Company’s Amended and Restated Bylaws;
−Removed: or (iv) action asserting a claim that is governed by the internal affairs doctrine of the State of Delaware, in each case, will be the Delaware Court of Chancery located within the State of Delaware.
−Removed: These choice of forum provisions may increase costs to bring a claim, discourage claims or limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or the Wayfair’s directors, officers or other employees, which may discourage such lawsuits against the Wayfair or the Wayfair’s directors, officers and other employees.
−Removed: Alternatively, if a court were to find the choice-of- forum provisions contained in the Charter to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.
−Removed: The Charter will not preclude or contract the scope of exclusive federal or concurrent jurisdiction for actions brought under the federal securities laws including the Exchange Act or the Securities Act of 1933, as amended, or the respective rules and regulations promulgated thereunder.
+Added: Our Bylaws and Charter generally provide that the Court of Chancery for the State of Delaware will be the exclusive forum for certain legal actions concerning the internal affairs of Wayfair, including but not limited to stockholder derivative litigation, and our Bylaws provide that the U.S.
+Added: federal district courts will be the exclusive forum for legal actions arising under the Securities Act, which could increase costs to bring such claims, discourage such claims or limit the ability of Wayfair’s stockholders to bring such claims in a judicial forum viewed by the stockholders as more favorable.
+Added: Our Bylaws provide that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for any (A) (i) derivative action or proceeding brought on behalf of Wayfair;
+Added: (ii) action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee or stockholder of Wayfair to Wayfair or Wayfair’s stockholders;
+Added: (iii) action asserting a claim against Wayfair or its current directors, officers, employees or stockholders arising pursuant to any provision of the Delaware General Corporation Law (“DGCL”), the Charter, or the Bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery for the State of Delaware;
+Added: or (iv) action asserting a claim against Wayfair or its current or former directors, officers, employees or stockholders governed by the internal affairs doctrine of the State of Delaware, in each case, will, to the fullest extent permitted by law, be the Court of Chancery for the State of Delaware or, solely if such court does not have subject matter jurisdiction thereof, in the other courts of competent jurisdiction in the State of Delaware or the U.S.
+Added: District Court for the District of Delaware, and (B) complaint asserting a cause of action arising under the Securities Act will be the U.S.
+Added: federal district courts.
+Added: Our Charter also contains exclusive forum provisions for the Court of Chancery for the State of Delaware that are consistent with the exclusive forum provisions for the Court of Chancery for the State of Delaware summarized above.
+Added: These exclusive forum provisions may increase costs to bring a claim, discourage claims or limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or Wayfair’s current or former directors, officers, other employees or stockholders, which may discourage such lawsuits against Wayfair or Wayfair’s current or former directors, officers, other employees and stockholders.
+Added: Alternatively, if a court were to find the exclusive forum provisions contained in our Bylaws or Charter to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.
Risks Related to Ownership of our Class A Common Stock
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This concentrated control limits your ability to influence corporate matters for the foreseeable future.
−Removed: For example, these stockholders are able to control elections of directors, amendments of our certificate of incorporation or bylaws, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans and approval of any merger or sale of assets for the foreseeable future.
+Added: For example, these stockholders are able to control elections of directors,
+Added: amendments of our Charter or Bylaws, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans and approval of any merger or sale of assets for the foreseeable future.
This control may materially adversely affect the market price of our Class A common stock.
−Removed: Additionally, holders of our Class B common stock may cause us to make strategic decisions or pursue acquisitions that could involve risks to you or may not
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−Removed: be aligned with your interests.
+Added: Additionally, holders of our Class B common stock may cause us to make strategic decisions or pursue acquisitions that could involve risks to you or may not be aligned with your interests.
The holders of our Class B common stock are also entitled to a separate vote if we seek to amend our certificate of incorporation to increase or decrease the par value of a class of our common stock or in a manner that alters or changes the powers, preferences or special rights of the Class B common stock in a manner that affects its holders adversely.
12 unchanged sentences
In connection with the issuance of each series of Non-Accreting Notes, we entered into capped calls with certain financial institutions, which we refer to as the option counterparties.
−Removed: The capped calls are expected generally to reduce the potential dilution upon conversion of the Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap.
+Added: The capped calls are expected generally to reduce the potential dilution upon conversion of the Non-Accreting Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted Non-Accreting Notes, as the case may be, with such reduction and/or offset subject to a cap.
From time to time, the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivative transactions with respect to our Class A common stock and/or purchasing or selling our Class A common stock or other securities of ours in secondary market transactions.
11 unchanged sentences
If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.
−Removed: T a ble of Contents
Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of our company more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our Class A common stock.
−Removed: Provisions in our certificate of incorporation and bylaws may have the effect of delaying or preventing a change of control or changes in our management.
−Removed: Our certificate of incorporation and bylaws include provisions that:
+Added: Provisions in our Charter and Bylaws may have the effect of delaying or preventing a change of control or changes in our management.
+Added: Our Charter and Bylaws include provisions that:
• permit the Board to establish the number of directors and fill any vacancies and newly created directorships;
• when the outstanding shares of our Class B common stock represent less than 10% of the then outstanding shares of Class A common stock and Class B common stock, provide that the Board will be classified into three classes with staggered, three year terms and that directors may only be removed for cause;
−Removed: • require super-majority voting to amend some provisions in our certificate of incorporation and bylaws;
+Added: • require super-majority voting to amend some provisions in our Charter and Bylaws;
• authorize the issuance of “blank check” preferred stock that the Board could use to implement a stockholder rights plan;
2 unchanged sentences
• provide that the Board is expressly authorized to make, alter or repeal our Bylaws;
−Removed: • restrict the forum for certain litigation against us to Delaware;
+Added: • our Charter and Bylaws restrict the forum for certain litigation against us to Delaware, and our Bylaws restrict the forum for certain other litigation against us to the U.S.
+Added: District Court for the District of Delaware or the U.S.
+Added: federal district courts;
• reflect the dual class structure of our common stock, as discussed above;
−Removed: • establish advance notice requirements for nominations for election to the Board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
+Added: • establish enhanced advance notice requirements for nominations for election to the Board or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.
These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of the Board, which is responsible for appointing the members of our management.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.