Third Quarter 2026
Filed Nov 5, 2026Warby Parker Announces Third Quarter 2026 Results
Net revenue increased 10.4% year over year to $244.7 million, gross margin expanded to 54.4%, and Adjusted EBITDA increased to $28.6 million. The company reaffirmed Adjusted EBITDA guidance while narrowing revenue guidance, although net income declined and quarterly Free Cash Flow was negative following Intelligent Eyewear investments.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 net revenueGAAP | $244.7M | – | 10.4% |
| Q3 2026 cost of goods soldGAAP | $111.6M | – | – |
| Q3 2026 gross profitGAAP | $133.2M | – | – |
| Q3 2026 gross marginGAAP | 54.4% | – | – |
| Q3 2026 Adjusted Cost of Goods Soldnon-GAAP | $111.1M | – | – |
| Q3 2026 Adjusted Gross Profitnon-GAAP | $133.6M | – | – |
| Q3 2026 Adjusted Gross Marginnon-GAAP | 54.6% | – | – |
| Q3 2026 selling, general, and administrative expensesGAAP | $129.6M | – | up $13.2 million |
| Q3 2026 SG&A as a percentage of revenueGAAP | 53.0% | – | increased by 50 basis points |
| Q3 2026 Adjusted Selling, General, and Administrative Expensesnon-GAAP | $120.8M | – | – |
| Q3 2026 Adjusted SG&A as a percentage of revenuenon-GAAP | 49.4% | – | – |
| Q3 2026 income from operationsGAAP | $3.56M | – | – |
| Q3 2026 interest and other income, netGAAP | $2.61M | – | – |
| Q3 2026 income before income taxesGAAP | $6.17M | – | – |
| Q3 2026 provision for income taxesGAAP | $563K | – | – |
| Q3 2026 net incomeGAAP | $5.6M | – | decreased $0.3 million |
| Q3 2026 basic earnings per shareGAAP | $0.04 | – | – |
| Q3 2026 diluted earnings per shareGAAP | $0.04 | – | – |
| Q3 2026 weighted average shares outstanding, basicGAAP | 124.7M | – | – |
| Q3 2026 weighted average shares outstanding, dilutedGAAP | 126.1M | – | – |
| Q3 2026 Adjusted EBITDAnon-GAAP | $28.6M | – | increased $2.8 million |
| Q3 2026 Adjusted EBITDA Marginnon-GAAP | 11.7% | – | increased 10 basis points |
| Q3 2026 Active Customers, trailing 12-month basisother | 2.74M | – | 3.0% |
| Q3 2026 Average Revenue per Customerother | $342 | – | 6.7% |
| Q3 2026 storesother | 364 stores | Opened 12 net new stores during the quarter | – |
| Q3 2026 net cash provided by operating activitiesGAAP | $24.7M | – | – |
| Q3 2026 purchases of property and equipmentGAAP | $26.7M | – | – |
| Q3 2026 Free Cash Flownon-GAAP | −$2M | – | – |
| Nine Months Ended September 30, 2026 net revenueGAAP | $722.7M | – | – |
| Nine Months Ended September 30, 2026 gross profitGAAP | $400.7M | – | – |
| Nine Months Ended September 30, 2026 gross marginGAAP | 55.4% | – | – |
| Nine Months Ended September 30, 2026 selling, general, and administrative expensesGAAP | $392.3M | – | – |
| Nine Months Ended September 30, 2026 income from operationsGAAP | $8.39M | – | – |
| Nine Months Ended September 30, 2026 net incomeGAAP | $13.42M | – | – |
| Nine Months Ended September 30, 2026 diluted earnings per shareGAAP | $0.11 | – | – |
| Nine Months Ended September 30, 2026 Adjusted EBITDAnon-GAAP | $91.00M | – | – |
| Nine Months Ended September 30, 2026 Adjusted EBITDA Marginnon-GAAP | 12.6% | – | – |
| Nine Months Ended September 30, 2026 net cash provided by operating activitiesGAAP | $78.85M | – | – |
| Nine Months Ended September 30, 2026 purchases of property and equipmentGAAP | $65.70M | – | – |
| Nine Months Ended September 30, 2026 Free Cash Flownon-GAAP | $13.15M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Full year 2026 outlook
- RevenueNet revenue of $966 to $976 million, representing approximately 11% to 12% growth versus full year 2025.
- NoteAdjusted EBITDA (non-GAAP) of $117 to $119 million, which equates to an Adjusted EBITDA Margin (non-GAAP) of 12.2% and 130 basis points of year-over-year expansion at the midpoint of the range.
- Note50 new store openings.
- NoteGuidance now includes a modest contribution from Intelligent Eyewear, along with the related launch and operating expenses.
What drove it
- Gross-margin expansion was primarily related to leverage in glasses, driven by reduced tariffs, customer shipping savings, optical lab efficiencies, and increased penetration of progressives and other lens treatments.
- Gross-margin benefits were partially offset by deleverage from growth in eye care and fixed occupancy expenses associated with 12 net new store openings.
- SG&A increased primarily because of retail compensation and corporate expenses, including higher technology costs. Lower marketing spend as a percentage of revenue partially offset those pressures.
- Quarterly Free Cash Flow reflected investments related to launching Intelligent Eyewear.
- Revenue growth was supported by 3.0% Active Customer growth and 6.7% growth in Average Revenue per Customer.
Concerns
- The company characterized the optical environment as uneven.
- Net income decreased $0.3 million to $5.6 million despite revenue growth and Adjusted EBITDA expansion.
- GAAP SG&A as a percentage of revenue increased by 50 basis points to 53.0%.
- Q3 Free Cash Flow was $(2.0) million, reflecting Intelligent Eyewear investments.
- Full-year revenue guidance was narrowed.
What to watch
- Customer pre-orders for the first Intelligent Eyewear collection beginning November 12 and delivery of customer orders during the holiday season.
- The modest Intelligent Eyewear revenue contribution and related launch and operating expenses incorporated into full-year guidance.
- Execution toward 50 new store openings in 2026.
- The balance between glasses-margin leverage and pressure from eye care growth and occupancy costs.
- Active Customer growth and Average Revenue per Customer following Q3 growth of 3.0% and 6.7%, respectively.
Balance sheet and cash flow
- Cash and cash equivalents were $287.9 million at September 30, 2026.
- Total assets were $792,150 (Amounts in thousands) at September 30, 2026.
- Total liabilities were $388,801 (Amounts in thousands) at September 30, 2026, including current lease liabilities of $39,477 (Amounts in thousands) and non-current lease liabilities of $225,326 (Amounts in thousands).
- Q3 2026 net cash provided by operating activities was $24.7 million; purchases of property and equipment were $26.7 million; Free Cash Flow was $(2.0) million.
- Nine-month net cash provided by operating activities was $78,852 (Amounts in thousands), purchases of property and equipment were $65,699 (Amounts in thousands), and Free Cash Flow was $13,153 (Amounts in thousands).
Analysis
Warby Parker reported Q3 net revenue of $244.7 million, up 10.4% year over year. Customer metrics showed a 3.0% increase in Active Customers to 2.74 million on a trailing 12-month basis and a 6.7% increase in Average Revenue per Customer to $342. The company opened 12 net new stores during the quarter and ended Q3 with 364 stores. No segment revenue disclosure was provided.
Gross profit was $133.2 million and gross margin was 54.4%, compared with $119.9 million and 54.1% in the prior year. Management attributed margin expansion to glasses leverage from reduced tariffs, customer shipping savings, optical lab efficiencies, and greater progressive-lens and other lens-treatment penetration. Growth in eye care and fixed occupancy costs associated with store openings partly offset those benefits. Adjusted Gross Margin was 54.6%, compared with 54.2% in the prior year.
Profitability below gross profit remained constrained by expense growth. GAAP SG&A rose $13.2 million to $129.6 million and increased 50 basis points as a percentage of revenue to 53.0%, driven by retail compensation and corporate expenses including higher technology costs. Lower marketing spend as a percentage of revenue provided a partial offset. Net income decreased $0.3 million to $5.6 million, while Adjusted EBITDA increased $2.8 million to $28.6 million and Adjusted EBITDA Margin increased 10 basis points to 11.7%.
Cash and cash equivalents were $287.9 million at September 30, 2026. Q3 operating cash flow was $24.7 million, but Free Cash Flow was $(2.0) million after $26.7 million of purchases of property and equipment, reflecting Intelligent Eyewear investments. For the first nine months, operating cash flow was $78,852 (Amounts in thousands) and Free Cash Flow was $13,153 (Amounts in thousands), compared with $35,603 (Amounts in thousands) in the prior year.
For full-year 2026, the company narrowed net revenue guidance to $966 to $976 million while reaffirming Adjusted EBITDA guidance of $117 to $119 million. The outlook includes a modest Intelligent Eyewear contribution and related launch and operating expenses, as well as 50 new store openings. The midpoint Adjusted EBITDA Margin outlook is 12.2%, representing 130 basis points of year-over-year expansion at the midpoint of the range.
Management, verbatim
One week from today, on November 12, we'll begin accepting pre-orders for our first Intelligent Eyewear collection and look forward to delivering customer orders during the holiday season. We can't wait for customers to experience these remarkable products firsthand.
Dave Gilboa, Co-Founder and Co-CEO
There's a tremendous amount happening across Warby Parker, from rolling out Warby Parker Care to expanding our retail footprint to launching our first Intelligent Eyewear collection. We're continuing to expand our products and services, build on the investments we've made over many years, like exams and insurance, and find new ways to serve our customers. In an uneven optical environment, we're staying focused on what we can control, while pursuing opportunities we believe can drive meaningful growth for years to come.
Neil Blumenthal, Co-Founder and Co-CEO
We delivered double-digit revenue growth in Q3, with Adjusted EBITDA exceeding our guidance. Our profitability reflects disciplined execution across the business, and we're maintaining that focus through the remainder of the year as we enter 2027 with significant financial flexibility.
Adrian Mitchell, Chief Financial Officer
Not in the filing
stated, not guessed- Prior-period outlook was not provided, so comparisons of actual results versus prior guidance are unavailable.
- Segment revenue, segment profitability, and segment growth disclosures were not provided.
- No share-repurchase program, share repurchase activity, or dividend declaration was disclosed.
- No conventional debt balance was disclosed; the balance sheet disclosed lease liabilities.
- No quarterly effective tax rate was reported.
- GAAP net income, GAAP net margin, and GAAP earnings-per-share guidance were not provided.
- Prior-quarter comparative figures were not provided for the reported Q3 metrics.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.