Wayfair Inc
For the period ended Dec 31, 2024. Filed Feb 20, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 20, 2025
W$111.74-1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-22.
0001616707-24-000014
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
0001616707-25-000022
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 134 previous paragraphs and 138 current paragraphs.
93 unchanged; 33 reworded; 11 added; 8 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Germany Restructuring
Current report
On January 10, 2025, we announced our decision to exit the German market (the “Germany Restructuring”), including a workforce reduction impacting approximately 730 employees, although we expect approximately half of these positions to relocate to other corporate offices. As a result of the Germany Restructuring, we expect to incur aggregate charges of approximately $102 million to $111 million, consisting of (i) approximately $40 million to $44 million in employee-related costs, including severance, benefits, relocation and transition costs and (ii) approximately $62 million to $67 million of other primarily non-cash charges, including gross impairment charges related to facility closures and other wind-down activities and excluding any recoveries that may be recognized related to our leases.
Current report
During the year ended December 31, 2024, Wayfair recorded impairment charges of $34 million associated with weakened macroeconomic conditions in connection with our German operations. This is inclusive of $21 million related to ROU assets and $13 million related to property, plant and equipment. Wayfair expects to incur the remainder of the aggregate charges during the first quarter of 2025.
Current report
During the year ended December 31, 2024, we recorded net charges of $37 million, inclusive of$34 million associated with weakened macroeconomic conditions in connection with our German operations,$2 million related to changes in sublease market conditions and $1 million related to construction in progress assets at identified U.S. locations.
Current report
During the year ended December 31, 2024, interest expense, netincreased to $29 million, compared to $17 million in the same period in 2023, primarily driven by the issuances of the 2029 Secured Notes and 2028 Notes (as defined below) in October 2024 and May 2023, respectively.
Current report
Other (expense) income, net
Current report
During the year ended December 31, 2024, gain on debt extinguishment decreased by $71 million, or 71.0%, compared to the same period in 2023.
Current report
Credit Agreement and Debt Arrangements
Current report
On October 8, 2024, Wayfair LLC (the “Issuer”), a subsidiary of Wayfair, issued $800 million aggregate principal amount of the 2029 Secured Notes. The 2029 Secured Notes will mature on October 31, 2029, unless earlier redeemed, in accordance with their terms or repurchased. The indenture contains covenants that restrict the Issuer’s ability and the ability of its restricted subsidiaries to, among other things, incur additional indebtedness, declare or pay dividends, redeem stock or make other distributions or restricted payments, make certain investments, create certain liens, enter into certain transactions with affiliates, agree to certain restrictions on the ability of the Issuer’s restricted subsidiaries to make certain payments, sell or transfer certain assets and consolidate, merge, sell or otherwise dispose of all or substantially all of the Issuer’s or its restricted subsidiaries’ assets.
Current report
On November 1, 2024, our 1.125% Convertible Senior Notes due 2024 (the “2024 Notes”) matured and we paid in cash the remaining outstanding principal amount of $117 million to the holders of the 2024 Notes.
Current report
Cash flows used in financing activities increased by $146 million during the year ended December 31, 2024, compared to the same period in 2023. The increase in cash used is primarily due to increases in payments for extinguishments of debt of $227 million and debt maturities of $117 million. These are partially offset by increases in proceeds from the issuance of debt of $108 million, decreases in premiums paid for capital call confirmations of $87 million and other financing inflows of $3 million.
Removed paragraphs (8)
Previous report
During the year ended December 31, 2023, our interest expense, net decreased by $10 million, or 37.0%, compared to the same period in 2022, primarily driven by higher interest income.
Previous report
Other income (expense), net
Previous report
Further, on January 19, 2024, we announced a workforce realignment plan, including a workforce reduction
Previous report
involving approximately 1,650 employees. As a result, we expect to incur between approximately $70 million and $80 million of
Previous report
costs, consisting primarily of employee severance and benefit costs, most of which are expected to be incurred in the first quarter
Previous report
of 2024.
Previous report
Credit Agreement and Convertible Debt
Previous report
Cash flows provided by financing activities increased by $61 million during the year ended December 31, 2023 compared to the same period in 2022, primarily due to $75 million of repurchases of our Class A common stock and $3 million of principal payments upon maturity of convertible debt, both of which occurred during the year ended December 31, 2022. These are partially offset by increased payments to extinguish convertible debt of $10 million and increased premiums paid for capped call confirmations of $7 million.
Reworded paragraphs (33)
Previous wording
Wayfair is one of the world’s largest online destinations for the home. Through our e-commerce business model, we offer visually inspired browsing, compelling merchandising, easy product discovery and attractive prices for over 30 million products from over 20 thousand suppliers.
Current wording
Wayfair is the destination for all things home. Through our e-commerce business model, we offer visually inspired browsing, compelling merchandising, easy product discovery and attractive prices for over 30 million products from over 20 thousand suppliers.
Previous wording
We believe an increasing portion of the dollars spent on home goods will be spent online and that there is an opportunity for acquiring more market share. Our business model is designed to grow our net revenue by acquiring new customers as well as stimulating repeat purchases from our existing customers. Through increasing brand awareness as well as paid and unpaid advertising, we attract new and repeat customers to our family of sites. We turn these customers into recurring shoppers by creating a seamless shopping experience across their entire journey — offering best-in-class product discovery, purchasing, fulfillment and customer service.
Current wording
We believe an increasing portion of the dollars spent on home goods will be spent online and that there is an opportunity for acquiring more market share. Our business model is designed to grow our net revenue by acquiring new customers as well as stimulating repeat purchases from our existing customers. Through increasing brand awareness as well as paid and unpaid advertising, we attract new and repeat customers to our family of sites. We aim to turn these customers into recurring shoppers by creating a seamless shopping experience across their entire journey — offering best-in-class product discovery, purchasing, fulfillment and customer service.
Previous wording
During the year ended December 31, 2023, net revenue decreased by 1.8% compared to the same period in 2022. As of December 31, 2023, we had 22 million active customers and during the year ended December 31, 2023, 79.6% of orders came from repeat buyers. The lower sales were a function of normalization in average order value following a period of intense inflation in 2022, which were offset by a recovery in order volume, which showed positive growth year-over-year. We also continued to manage our advertising spend according to a return on investment-oriented approach that carefully tracks and monitors the results of advertising campaigns as we seek to maintain appropriate return targets.
Current wording
During the year ended December 31, 2024, net revenue decreased by 1.3% compared to the same period in 2023. As of December 31, 2024, we had 21 million active customers and during the year ended December 31, 2024, 80.1% of orders came from repeat buyers. The lower sales were due to lower order volume, which was driven by challenges in the category such as macroeconomic pressures, including consumer spending patterns and housing market conditions, compared to the same period in 2023. We also continued to manage our advertising spend according to a return on investment-oriented approach that carefully tracks and monitors the results of advertising campaigns as we seek to maintain appropriate return targets.
Previous wording
We are continuing to closely monitor macroeconomic impacts, including, but not limited to, geopolitical events and rising and fluctuating interest rates and inflation on our business, results of operations and financial results. These developments have and may continue to negatively impact global economic activity and consumer behavior, which have and may continue to adversely affect our business and our results of operations. As our customers react to these global economic conditions, we may take additional precautionary measures to limit or delay expenditures and preserve capital and liquidity.
Current wording
We closely monitor macroeconomic conditions, including, but not limited to, economic instability, changes in tax laws, regulations and new or increased tariffs, including based on the recent United States (“U.S.”) presidential election, sustained higher interest rates and inflationary pressures, on our business, results of operations and financial results. These developments have and may continue to negatively impact global economic activity and consumer behavior, which have and may continue to adversely affect our business and our results of operations. As our customers react to these global economic conditions, we may take additional precautionary measures to limit or delay expenditures and preserve capital and liquidity.
Previous wording
While it is difficult to quantify and predict all of the impacts these global economic events, including rising and fluctuating inflation and interest rates, will have on our business and to predict consumer spending in the near term, we believe the long-term opportunity that we see for shopping for the home online remains unchanged.
Current wording
While it is difficult to quantify and predict all of the impacts these global economic events, including fluctuating interest rates and inflationary pressures, will have on our business and to predict consumer spending in the near term, we believe the long-term opportunity that we see for shopping for the home online remains unchanged.
Previous wording
We measure our business using the key financial statement and operating metrics that are reflected in the below table. See “Non-GAAP Financial Measures” below for more information regarding our use of Adjusted EBITDA, Free Cash Flow and Adjusted Diluted Earnings or Loss per Share and a reconciliation of these non-U.S. generally accepted accounting principles (“GAAP’) financial measures to the most directly comparable GAAP financial measure.
Current wording
We measure our business using the key financial statement and operating metrics that are reflected in the below table. See “Non-GAAP Financial Measures” below for more information regarding our use of Adjusted EBITDA, Free Cash Flow and Adjusted Diluted Earnings or Loss per Share and a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure that is prepared in accordance with accounting principles generally accepted in the United States of America or “GAAP.”
Previous wording
During the year ended December 31, 2023, net revenue decreased by $215 million, or 1.8%, compared to the same period in 2022, which reflects recent macroeconomic pressures felt by consumers. The decrease in net revenue was due to lower average order value due, in part, to normalization of inflationary pressures in the supply chain compared to the same period in 2022.
Current wording
During the year ended December 31, 2024, net revenue decreased by $152 million, or 1.3%, compared to the same period in 2023, which reflects continued macroeconomic pressures felt by consumers. The decrease in net revenue is due to lower order volume, which was driven by challenges in the category such as macroeconomic pressures, including consumer spending patterns and housing market conditions, compared to the same period in 2023.
Previous wording
During the year ended December 31, 2023, our United States (“U.S.”) net revenue increased by 0.2% and International net revenue decreased by 13.3% compared to the same period in 2022. During the year ended December 31, 2023, International Net Revenue Constant Currency Growth was (11.6)% (see “Non-GAAP Financial Measures” below for more information regarding our use of Net Revenue Constant Currency Growth).
Current wording
During the year ended December 31, 2024, our U.S. net revenue decreased by 1.0% and International net revenue decreased by 2.8% compared to the same period in 2023. During the year ended December 31, 2024, International Net Revenue Constant Currency Growth was (2.7)% (see “Non-GAAP Financial Measures” below for more information regarding our use of Net Revenue Constant Currency Growth).
Previous wording
Cost of goods sold is sensitive to many factors, including quarter-to-quarter variability in product mix, pricing strategies, changes in wholesale, shipping and fulfillment costs, including associated applicable customs duties and fees earned for supplier services rendered. During the year ended December 31, 2023, cost of goods sold decreased by $466 million, or 5.3%, compared to the same period in 2022. The decrease in cost of goods sold is primarily driven by operational cost savings initiatives.
Current wording
Cost of goods sold is sensitive to many factors, including quarter-to-quarter variability in product mix, pricing strategies, changes in wholesale, shipping and fulfillment costs, including associated applicable customs duties and fees earned for supplier services rendered. During the year ended December 31, 2024, cost of goods sold decreased by $59 million, or 0.7%, compared to the same period in 2023. The decrease in cost of goods sold is driven by a combination of operational cost savings initiatives and lower order volume, which was driven by challenges in the category such as macroeconomic pressures, including consumer spending patterns and housing market conditions, compared to the same period in 2023.
Previous wording
As a percentage of net revenue, cost of goods sold decreased to 69.4% for the year ended December 31, 2023 compared to 72.0% in the same period in 2022 due to mix shifts, operational efficiencies and decreased logistics costs.
Current wording
As a percentage of net revenue, cost of goods sold increased to 69.8%for the year ended December 31, 2024, compared to 69.4% in the same period in 2023 due to mix shifts and lower net revenue.
Previous wording
During the year ended December 31, 2023, our equity-based compensation and related taxes included in customer service and merchant fees and selling, operations, technology, general and administrative increased by $97 million, or 18.8% compared to the same period in 2022, driven by an increase in vested restricted stock units in 2023 compared to the same period in 2022.
Current wording
During the year ended December 31, 2024, our equity-based compensation and related taxes included in customer service and merchant fees and selling, operations, technology, general and administrative decreased by $212 million, or 34.6%, compared to the same period in 2023, driven by a decrease in vested restricted stock units during the year ended December 31, 2024, compared to the same period in 2023.
Previous wording
During the year ended December 31, 2023, excluding the impact of equity-based compensation, our expenses for customer service and merchant fees decreased by $70 million, or 11.7% compared to the same period in 2022. The decrease in customer service and merchant fees is primarily due to decreased compensation costs in 2023 compared to the same period in 2022.
Current wording
During the year ended December 31, 2024, excluding the impact of equity-based compensation, our expenses for customer service and merchant fees decreased by $77 million, or 14.6%, compared to the same period in 2023. The decrease in customer service and merchant fees is primarily due to decreased compensation costs during the year ended December 31, 2024, compared to the same period in 2023.
Previous wording
As a percentage of net revenue, total customer service and merchant fees decreased to 4.6% for the year ended December 31, 2023 compared to 5.2% in the same period in 2022 due to decreased compensation costs.
Current wording
As a percentage of net revenue, total customer service and merchant fees decreased to 4.0% for the year ended December 31, 2024, compared to 4.6% in the same period in 2023 due to decreased compensation costs.
Previous wording
During the year ended December 31, 2023, our advertising expenses decreased by $76 million or 5.2% as compared to the same period in 2022. The decrease reflects our response to changing market conditions as we sought to maintain our return targets across various channels.
Current wording
During the year ended December 31, 2024, our advertising expenses increased by $75 million, or 5.4%, compared to the same period in 2023. The increase reflects our response to changing market conditions and renewed investment opportunities, as we sought to maintain our return targets across various channels.
Previous wording
As a percentage of net revenue, advertising expenses decreased to 11.6% for the year ended December 31, 2023 compared to 12.1% in the same period in 2022 due in part to maintaining efficiencies in our advertising channel mix.
Current wording
As a percentage of net revenue, advertising expenses increased to 12.4% forthe year ended December 31, 2024 compared to 11.6% in the same period in 2023 due to changes in our advertising channel mix as we seek to maximize returns on advertising spend within our efficiency parameters.
Previous wording
During the year ended December 31, 2023, excluding the impact of equity-based compensation and related taxes, our expenses for selling, operations, technology, general and administrative activities decreased by $280 million, or 13.1% compared to the same period in 2022. The decrease is primarily due to decreased personnel and information technology costs, partially offset by increased depreciation and amortization.
Current wording
During the year ended December 31, 2024, excluding the impact of equity-based compensation and related taxes, our expenses for selling, operations, technology, general and administrative activities decreased by $268 million, or 14.4% compared to the same period in 2023. The decrease is primarily due to decreased compensation costs.
Previous wording
As a percentage of net revenue, total selling, operations, technology, general and administrative expenses decreased to 20.4% for the year ended December 31, 2023 compared to 21.5% in the same period in 2022, primarily due to decreased compensation costs.
Current wording
As a percentage of net revenue, total selling, operations, technology, general and administrative expenses decreased to 16.7% for the year ended December 31, 2024, compared to 20.4% in the same period in 2023, primarily due to decreased compensation costs.
Previous wording
During the year ended December 31, 2023, impairment and other related charges decreased by $25 million or 64.1% as compared to the same period in 2022. As a percentage of net revenue, impairment and other related net charges decreased to 0.1% from 0.3% in the same period in 2022.
Current wording
During the year ended December 31, 2024, impairment and other related charges increased by $23 million, or 164.3%compared to the same period in 2023. As a percentage of net revenue, impairment and other related net charges increased to 0.3%from 0.1% in the same period in 2023.
Previous wording
During the year ended December 31, 2023, we recorded net charges of $14 million, inclusive of $5 million related to consolidation of certain customer service centers and $9 million related to construction in progress assets at identified U.S. locations. During the year ended December 31, 2022, we recorded net charges of $31 million of lease impairment and other charges related to changes in market conditions around future sublease income for one office location in the U.S. and charges of $8 million related to construction in progress assets at an International warehouse.
Current wording
During the year ended December 31, 2023, we recorded net charges of $14 million, inclusive of $5 million related to consolidation of certain customer service centers and $9 million related to construction in progress assets at identified U.S. locations.
Previous wording
During the year ended December 31, 2023, restructuring charges increased by $34 million or 109.7% as compared to the same period in 2022. As a percentage of net revenue, restructuring charges increased to 0.5% from 0.3% in the same period in 2022.
Current wording
During the year ended December 31, 2024, restructuring charges increased by $14 million, or 21.5%, compared to the same period in 2023. As a percentage of net revenue, restructuring charges increased to 0.7% from 0.5% in the same period in 2023.
Previous wording
During the year ended December 31, 2023, we incurred $65 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2023 workforce reductions. During the year ended December 31, 2022, we incurred $31 million of charges consisting primarily of one-time employee severance and benefit costs associated with the August 2022 workforce reductions.
Current wording
During the year ended December 31, 2024, we incurred $79 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2024 workforce reductions. During the year ended December 31, 2023, we incurred $65 million of charges consisting primarily of one-time employee severance and benefit costs associated with the January 2023 workforce reductions.
Previous wording
During the year ended December 31, 2023, we recorded other income, net of $1 million, compared to other expense, net of $4 million in the same period in 2022, primarily driven by increases in foreign currency transaction gains. Included in other income (expense), net are changes in foreign currency transaction gains and losses and long-term investment income or losses.
Current wording
During the year ended December 31, 2024, other (expense) income, net increased by $22 million, or 2,200.0%, compared to the same period in 2023, primarily driven by foreign currency rate fluctuations between the U.S. Dollar and the Canadian Dollar. Included in other (expense) income, net are changes in foreign currency transaction gains and losses and long-term investment income or losses.
Previous wording
During the year ended December 31, 2023, our gain on debt extinguishment increased by $4 million or 4.2% compared to the same period in 2022. In connection with the issuance of our 2028 Notes, we recorded a $100 million gain on debt extinguishment, representing the difference between the cash paid for principal of $514 million and the combined net carrying value of the 2024 Notes and 2025 Notes of $614 million. In connection with the issuance of our 2027 Notes, we recorded a $96 million gain on debt extinguishment, representing the difference between the cash paid for principal of $504 million and the combined net carrying value of the 2024 Notes and 2025 Notes of $600 million.
Current wording
During the year ended December 31, 2024, we recorded a $29 million gain on debt extinguishment, representing the difference between the cash paid for principal, plus accrued and unpaid interest and transaction fees of $741 million and the combined net carrying value of the 2025 Notes, 2026 Notes and 2025 Accreting Notes (as defined below) of $770 million.
Previous wording
During the year ended December 31, 2023, our provision for income taxes, net decreased by $3 million or 25.0% compared to the same period in 2022, primarily related to the level and mix of income earned in the U.S. and certain foreign jurisdictions and U.S. state income taxes. Refer to Note 11, Income Taxes, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K for additional information.
Current wording
During the year ended December 31, 2024, our provision for income taxes, net increased by $1 million, or 11.1%, compared to the same period in 2023, primarily related to the level and mix of income earned in the U.S. and certain foreign jurisdictions and U.S. state income taxes. Refer to Note 11, Income Taxes,in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K for additional information.
Previous wording
At December 31, 2023, our principal source of liquidity was cash and cash equivalents and short-term investments totaling $1.4 billion. Additionally, we have a $600 million senior secured revolving credit facility that matures on March 24, 2026 (the “Revolver”). As of December 31, 2023, there were no revolving loans outstanding under the Revolver. We had outstanding letters of credit, primarily as security for certain lease agreements, for $76 million as of December 31, 2023, which reduced the availability of credit under the Revolver. Excluding liquidity available through our Revolver, the following table shows sources of liquidity for the periods presented:
Current wording
As of December 31, 2024, our principal source of liquidity was cash and cash equivalents and short-term investments totaling$1.4 billion. Additionally, we have a $600 million senior secured revolving credit facility that matures on March 24, 2026 (the “Revolver”). As of December 31, 2024, there were no revolving loans outstanding under the Revolver. We had outstanding letters of credit, primarily as security for certain lease agreements, for $71 million as of December 31, 2024, which reduced the availability of credit under the Revolver. Excluding liquidity available through our Revolver, the following table shows sources of liquidity for the periods presented:
Previous wording
As of December 31, 2023, we had $3.2 billion principal amount of indebtedness outstanding.
Current wording
As of December 31, 2024, we had $3.2 billion principal amount of indebtedness outstanding. 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”)
Previous wording
During the year ended December 31, 2023, we used $514 million of the net transaction amount from the issuance of the 2028 Notes to repurchase for cash $83 million aggregate principal amount of the 2024 Notes and $535 million aggregate principal amount of the 2025 Notes in privately negotiated repurchase transactions. See Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K.
Current wording
On November 11, 2024, we repurchased $518 million in aggregate principal amount of the 2025 Notes, $215 million in aggregate principal amount of the 2026 Notes and the remaining $39 million in aggregate principal amount of the 2025 Accreting Notes, in privately negotiated transactions. See Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K for additional information on debt and other financing transactions.
Previous wording
The conditional conversion features of the 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes (collectively, the “Non-Accreting Notes” and together with the 2025 Accreting Notes, the “Notes”) were not triggered during the calendar quarter ended December 31, 2023, therefore, the 2024 Notes, 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes are not convertible during the calendar quarter ended March 31, 2024 pursuant to the applicable last reported sales price conditions. The 2025 Accreting Notes are convertible at any time prior to the close of business on the second business day immediately preceding the maturity date. During the year ended December 31, 2023, there were no conversions of the Notes.
Current wording
The conditional conversion features of the 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes were not triggered during the calendar quarter ended December 31, 2024, therefore, the 2025 Notes, 2026 Notes, 2027 Notes and 2028 Notes are not convertible during the calendar quarter ended March 31, 2025 pursuant to the applicable last reported sales price conditions.
Previous wording
The credit agreement and indentures governing our convertible notes contain restrictions and covenants that may limit our operating flexibility. Specifically, the Revolver contains affirmative and negative covenants customarily applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict our ability, subject to negotiated exceptions, to incur additional indebtedness and additional liens on our assets, engage in mergers or acquisitions or dispose of assets, pay dividends or make other distributions, voluntarily prepay other indebtedness, enter into transactions with affiliated persons, make investments, or change the nature of our businesses. The Revolver also requires us to maintain certain levels of performance in order to maintain our access to the Revolver. For instance, we are required to maintain a Consolidated Senior Secured Debt to Consolidated EBITDA Ratio (as defined in the credit agreement governing the Revolver) of 4.0 to 1.0, subject to a 0.5 step-up following certain permitted acquisitions. For information regarding our credit agreement and convertible notes, see Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K. As of December 31, 2023, we were in compliance with all the terms and conditions of our debt agreements.
Current wording
The credit agreement and indentures governing our convertible notes contain restrictions and covenants that may limit our operating flexibility. Specifically, the Revolver contains affirmative and negative covenants customarily applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict our ability, subject to negotiated exceptions, to incur additional indebtedness and additional liens on our assets, engage in mergers or acquisitions or dispose of assets, pay dividends or make other distributions, voluntarily prepay other indebtedness, enter into transactions with affiliated persons, make investments, or change the nature of our businesses. The Revolver also requires us to maintain certain levels of performance in order to maintain our access to the Revolver. For instance, we are required to maintain a Consolidated Senior Secured Debt to Consolidated EBITDA Ratio (as defined in the credit agreement governing the Revolver) of 4.0 to 1.0, subject to a 0.5 step-up following certain permitted acquisitions. For information regarding our credit agreement and other notes, see Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K. As of December 31, 2024, we were in compliance with all the terms and conditions of our debt agreements.
Previous wording
Cash flows provided by operating activities increased by $1.0 billion during the year ended December 31, 2023 compared to the same period in 2022, primarily due to an increase in net cash adjusted for non-cash items of $658 million and an increase of $365 million for cash provided by changes in operating assets and liabilities.
Current wording
Cash flows provided by operating activities decreased by $32 million during the year ended December 31, 2024, compared to the same period in 2023, primarily due to a decrease of $135 million for cash changes in operating assets and liabilities partially offset by an increase in net loss adjusted for non-cash items of $103 million.
Previous wording
Cash flows used in investing activities increased by $153 million during the year ended December 31, 2023 compared to the same period in 2022, primarily due to decreases in sales and maturities of short- and long-term investments of $656 million, partially offset by decreases in purchases of short- and long-term investments of $394 million, decreases in purchases of property and equipment and site and software development costs of $107 million, and decreases in other investing activities of $2 million.
Current wording
Cash flows used in investing activities increased by $110 million during the year ended December 31, 2024, compared to the same period in 2023, primarily due to decreases in sales and maturities of short- and long-term investments of $194 million, increases in purchases of short- and long-term investments of $31 million and decreases of other investing activities of $2 million, partially offset by decreases in purchases of property and equipment and site and software development costs of $117 million.
Previous wording
Purchases of property and equipment and site and software development costs (collectively, “Capital Expenditures”) were 2.9% of net revenue for the year ended December 31, 2023 and related primarily to equipment purchases and improvements for leased warehouses within our expanding logistics network and ongoing investments, including in our proprietary technology and operational platform.
Current wording
Purchases of property and equipment and site and software development costs (collectively, “Capital Expenditures”) were 2.0% of net revenue for the year ended December 31, 2024 and related primarily to equipment purchases and improvements for leased warehouses within our expanding logistics network and ongoing investments, including our physical retail store expansion, proprietary technology and operational platform.
Previous wording
(1) Represents future interest and principal payments on the Notes. For information regarding our convertible notes, see Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K.
Current wording
(1) Represents future interest and principal payments on the Notes. For information regarding the Notes, see Note 6, Debt and Other Financing, in the notes to the consolidated financial statements, included in Part II, Item 8, Financial Statements and Supplementary Data, in this Annual Report on Form 10-K.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
During the year ended December 31, 2023, we recorded a $100 million gain on debt extinguishment, representing the difference between the cash paid for principal of $514 million and the combined net carrying value of the 2024 Notes and 2025 Notes (as defined below) of $614 million.