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Warby Parker, the Direct-to-Consumer (DTC) eyewear company, has decided to list its shares to the public through a direct listing on the New York Stock Exchange for the first time.
Details about the Offering
Under the direct listing, the registered shareholders of Warby Parker plan to offer 77.7 million Class A shares.
The IPO is expected to take place late this month, on or about September 29, 2021. The shares will be traded on the NYSE under the symbol “WRBY." (See IPO Calendar on TipRanks)
Warby expects that the net proceeds from the transaction will be around $190 million.
Warby has raised a total of $535.5 million in fundraising over nine rounds, the most recent of which was $120 million raised in August of last year.
More about Warby Parker
Founded in 2010, Warby Parker is a lifestyle company that offers fashionable eyewear at an affordable price. It initially began its operations as an e-commerce platform.
Since then, the company has developed into a brand that offers eyeglasses, contact lenses, and services such as glasses insurance, eye exams, and vision tests both online and in stores. The company had roughly 145 retail outlets as of June 30, 2021.
A Look at Warby Parker’s Financials
According to the data, Warby Parker's full-year results for 2020 were not very encouraging, with sales growth declining year-over-year and losses rising.
For 2020, sales climbed by only 6% to $393.7 million. In 2019, on the other hand, revenues increased 36% year-over-year to $370.5 million. In addition, losses grew marginally to $55.9 million in 2020, up from $57.5 million in 2019.
Meanwhile, Warby also published its half-year financial results for the period ending June 30, 2021. Though the company reported strong revenue growth in recent months, it still continued to lose money.
Revenues for the first half of 2021 were $270.5 million, up 53% year-over-year, with a net loss of $7.3 million. Furthermore, the corporation recorded a $356.3 million accumulated deficit, which is very significant.
Bottom Line for Warby’s Business
Warby operates in a massive market that is projected to witness strong growth in the future.
According to Statista, the global eyeglasses market was estimated to be worth $140 billion in 2020 and is expected to reach $197.2 billion by 2027. Another report from Fortune Business Insights estimates the global vision care market to reach $192 billion by 2026, at a CAGR of 5.6%, between 2019 and 2026.
Given its diverse portfolio, Warby should benefit from the growing global eyeglasses industry trend.
Regardless of the above, investors should be aware of the risks associated with the investment before proceeding.
Warby Parker, like all other retailers, is exposed to the effects of the global COVID-19 pandemic. The corporation closed around 135 outlets in March 2020, which had an impact on its revenues. However, now that the COVID-19 situation is under control, Warby has been aggressively increasing its physical footprint, which should aid its top-line growth.
Furthermore, the optical business is fiercely competitive, and Warby must continue to make continuous attempts to capitalize on this expanding market.
Another matter worth mentioning is that the company has yet to turn a profit. It has a history of losses and may take some time to achieve profitability.
As a result, before investing in this company, investors should look into the fundamentals as well as the risk considerations.
Disclosure: At the time of publication, Shalu Saraf did not have a position in any of the securities mentioned in this article.
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