Wayfair Inc.

Previous wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q are forward looking statements, including statements regarding our investment plans and anticipated returns on those investments; our plans for growth, including customer growth; our future results of operations and financial position; available liquidity and access to financing sources; anticipated cost-cutting and liability and dilution management exercises and the expected results of such exercises; our business strategy; plans and objectives of management for future operations, including regarding our physical retail stores and omni-channel strategy; investment in our logistics network; consumer activity and behaviors; developments in our technology and systems, including our use of artificial intelligence and machine learning technologies and the anticipated results of those developments; and the impact of macroeconomic events, including interest rates, tariffs and inflation, and our response to such events. In some cases, you can identify forward-looking statements by terms such as “aim,” “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “continues,” “could,” “intends,” “goals,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts” or “potential” or the negative of these terms or other similar expressions.

Current wording

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q are forward looking statements, including statements regarding our investment plans and anticipated returns on those investments; our plans for growth, including customer and revenue growth and growth rates; our future results of operations and financial position; available liquidity and access to financing sources; performance across our brands and segments; anticipated cost-cutting and liability and dilution management exercises and the expected results of such exercises; our business strategy; anticipated benefits of our strategic initiatives; plans and objectives of management for future operations, including regarding our physical retail stores and omni-channel strategy; investment in our logistics network; consumer activity and behaviors; developments in our technology and systems, including our use of artificial intelligence and machine learning technologies and the anticipated results of those developments; and the impact of macroeconomic events, including interest rates, tariffs and inflation, and our response to such events. In some cases, you can identify forward-looking statements by terms such as “aim,” “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “continues,” “could,” “intends,” “goals,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts” or “potential” or the negative of these terms or other similar expressions.

Previous wording

•our ability to increase our net revenue per active customer;

Current wording

•our ability to increase our net revenue;

Previous wording

•our ability to curate, market, grow and maintain strong brands;

Current wording

•our ability to curate, market, grow and maintain strong brands and to grow our customer base;

Previous wording

During the three months ended March 31, 2026, net revenue increased by 7.4% compared to the same period in 2025. As of March 31, 2026, we had 21 million active customers and during the three months ended March 31, 2026, 79.8% of orders came from repeat buyers. The increased sales represents our ongoing execution of business initiatives amid persistent macroeconomic pressures on consumers. 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 three months ended June 30, 2026, net revenue increased by 7.5% compared to the same period in 2025. As of June 30, 2026, we had 22 million active customers and during the three months ended June 30, 2026, 80.2% of orders came from repeat buyers. The increased sales represents our ongoing execution of business initiatives amid persistent macroeconomic pressures on consumers. 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

During the three months ended March 31, 2026, net revenue increased by $201 million, or 7.4%, compared to the same period in 2025, which reflects our ongoing execution of business initiatives amid persistent macroeconomic pressures on consumers. The increase in net revenue is due to higher average order value in addition to higher order volume resulting from brand and consumer mix shifts, compared to the same period in 2025.

Current wording

During the three months ended June 30, 2026, net revenue increased by $246 million, or 7.5%, compared to the same period in 2025, which reflects our ongoing execution of business initiatives amid persistent macroeconomic pressures on consumers. The increase in net revenue is due primarily to higher order volume in addition to higher average order value, compared to the same period in 2025.

Previous wording

During the three months ended March 31, 2026, our U.S. net revenue increased by 7.5%. During the three months ended March 31, 2026, our International net revenue increased by 6.0% compared to the same period in 2025. During the three months ended March 31, 2026, International Net Revenue Constant Currency Growth was 1.7% (see “Non-GAAP Financial Measures” below for more information regarding our use of Net Revenue Constant Currency Growth).

Current wording

During the three months ended June 30, 2026, our U.S. net revenue increased by 8.7% compared to the same period in 2025. During the three months ended June 30, 2026, our International net revenue decreased by 1.3% compared to the same period in 2025. During the three months ended June 30, 2026, International Net Revenue Constant Currency Growth was (2.0)% (see “Non-GAAP Financial Measures” below for more information regarding our use of Net Revenue Constant Currency Growth).

Previous wording

Operating expenses consist of customer service and merchant fees; advertising; selling, operations, technology, general and administrative expenses; impairment and other related net charges and restructuring and other charges, net. We disclose separately the equity-based compensation and related taxes that are included in customer service and merchant fees and selling, operations, technology and general and administrative expenses.

Current wording

Operating expenses consist of customer service and merchant fees; advertising; selling, operations, technology, general and administrative expenses; impairment and other related net charges and restructuring and other charges, net. We disclose separately the equity-based compensation and related taxes that are included in customer service and merchant fees and selling, operations, technology, general and administrative expenses.

Previous wording

During the three months ended March 31, 2026, our equity-based compensation and related taxes included in customer service and merchant fees and selling, operations, technology, general and administrative increased by $4 million, or 6.1%, compared to the same period in 2025, due to expense recognized during the three months ended March 31, 2026 related to the PSUs, partially offset by variability in our stock price around the grant date of restricted stock units.

Current wording

During the three months ended June 30, 2026, equity-based compensation and related taxes included in customer service and merchant fees and selling, operations, technology, general and administrative decreased by $29 million, or 29.3%, compared to the same period in 2025, due to variability in our stock price on the grant dates of the restricted stock units granted during the three months ended June 30, 2025, partially offset by the expense recognized during the three months ended June 30, 2026 related to the PSUs.

Previous wording

During the three months ended March 31, 2026, excluding the impact of equity-based compensation and related taxes, our expenses for customer service and merchant fees increased by $8 million, or 7.7%, compared to the same period in 2025. The increase in customer service and merchant fees is primarily due to increased net revenue.

Current wording

During the three months ended June 30, 2026, excluding the impact of equity-based compensation and related taxes, our expenses for customer service and merchant fees increased by $8 million, or 6.8%, compared to the same period in 2025. The increase in customer service and merchant fees is due primarily to increased net revenue.

Previous wording

During the three months ended March 31, 2026, our advertising expenses decreased by $15 million, or 4.4%, compared to the same period in 2025. The decrease reflects our response to changing market conditions and changes in our advertising channel mix, as we seek to maintain our return targets across various channels.

Current wording

During the three months ended June 30, 2026, advertising expenses increased by $20 million, or 5.4%, compared to the same period in 2025. The increase reflects our response to changing market conditions and changes in our advertising channel mix, as we seek to maintain our return targets across various channels.

Previous wording

As a percentage of net revenue, advertising expenses decreased to 11.2% for the three months ended March 31, 2026 compared to 12.6% in the same period in 2025 due to changes in our advertising channel mix as we seek to maximize returns on advertising spend within our efficiency parameters.

Current wording

As a percentage of net revenue, advertising expenses decreased to 11.1% for the three months ended June 30, 2026 compared to 11.4% in the same period in 2025 due to changes in our advertising channel mix as we seek to maximize returns on advertising spend within our efficiency parameters.

Previous wording

As a percentage of net revenue, total selling, operations, technology, general and administrative expenses decreased to 14.5% for the three months ended March 31, 2026, compared to 15.7% in the same period in 2025, primarily due to the increase in net revenue.

Current wording

As a percentage of net revenue, total selling, operations, technology, general and administrative expenses decreased to 12.2% for the three months ended June 30, 2026, compared to 14.2% in the same period in 2025, primarily due to decreased compensation costs and increased net revenue.

Previous wording

During the three months ended March 31, 2026, impairment and other related charges decreased by $23 million, or 100.0%, compared to the same period in 2025. The decrease is due to impairment charges recognized in the prior year related to the Germany Restructuring and weakened macroeconomic conditions in connection with the German operations. No impairment charges were recorded during the three months ended March 31, 2026.

Current wording

During the three months ended June 30, 2026, impairment and other related charges increased by $2 million, or 100.0%, compared to the same period in 2025. The increase is due to the exit of a customer service center in the U.S. No impairment charges were recorded during the three months ended June 30, 2025.

Previous wording

During the three months ended March 31, 2026, interest expense, net increased by $16 million compared to the same period in 2025, primarily driven by the issuances of the 2032 Secured Notes in November 2025 and of the 2030 Secured Notes in March 2025.

Current wording

During the three months ended June 30, 2026, interest expense, net increased by $10 million compared to the same period in 2025, primarily driven by the issuances of the 2032 Secured Notes in November 2025 and of the 2034 Secured Notes in May 2026, partially offset by redemptions of the 2027 Notes in March 2026 and all of the 2028 Notes in June 2026.

Previous wording

During the three months ended March 31, 2026, we incurred $11 million of other (expense) income, net primarily driven by foreign currency translation losses. During the three months ended March 31, 2025, we recognized $10 million of other (expense) income, net primarily attributable to fluctuations between the U.S. Dollar and the Euro. Included in other (expense) income, net are changes in foreign currency transaction gains and losses and long-term investment income or losses.

Current wording

During the three months ended June 30, 2026, we incurred $4 million of other (expense), net primarily driven by foreign currency translation losses. During the three months ended June 30, 2025, we recognized $23 million of other (expense) income, net, primarily attributable to 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 three months ended March 31, 2026, loss on debt extinguishment increased by $68 million compared to the same period in 2025.

Current wording

During the three months ended June 30, 2026, loss on debt extinguishment increased by $65 million compared to the same period in 2025.

Previous wording

During the three months ended March 31, 2026, we recorded a $43 million loss on debt extinguishment, representing the difference between the cash paid for principal, plus accrued and unpaid interest and transaction fees of $99 million and the net carrying value of the 2028 Notes of $56 million.

Current wording

During the three months ended June 30, 2026, we recorded a $59 million loss on debt extinguishment, representing the difference between the cash paid for principal, plus accrued and unpaid interest and transaction fees of $148 million and the net carrying value of the 2028 Notes of $89 million.

Previous wording

During the three months ended March 31, 2026, our provision for income taxes, net decreased by $2 million, or 66.7% compared to the same period in 2025.

Current wording

During the three months ended June 30, 2026, our provision for income taxes, net increased by $1 million, or 50.0% compared to the same period in 2025.

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 three months ended March 31, 2026, cost of goods sold increased by $158 million, or 8.3%, compared to the same period in 2025. The increase in cost of goods sold is driven by higher net revenue, in addition to the absence of a one-time benefit of $38 million related to a resolution on the valuation of duties, partially offset by $5 million of expense related to duties assessments recognized during the three months ended March 31, 2025.

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 six months ended June 30, 2026, cost of goods sold increased by $334 million, or 8.0%, compared to the same period in 2025. The increase in cost of goods sold is driven by higher net revenue, in addition to the absence of a one-time benefit of $38 million related to a resolution on the valuation of duties, partially offset by $5 million of expense related to duties assessments recognized during the three months ended March 31, 2025.

Previous wording

As a percentage of net revenue, cost of goods sold increased to 70.0% for the three months ended March 31, 2026 compared to 69.3% in the same period in 2025, due to investments in the customer experience and a one-time benefit recognized during the three months ended March 31, 2025 related to a resolution on the valuation of duties, partially offset by the growth of our supplier services.

Current wording

As a percentage of net revenue, cost of goods sold increased to 70.0% for the six months ended June 30, 2026 compared to 69.7% in the same period in 2025, due to investments in the customer experience and a one-time benefit recognized during the three months ended March 31, 2025, related to the resolution on the valuation of duties, partially offset by growth of our supplier services.

Previous wording

As a percentage of net revenue, total customer service and merchant fees remained relatively constant at 3.9% for the three months ended March 31, 2026 compared to the same period in 2025.

Current wording

As a percentage of net revenue, total customer service and merchant fees remained relatively constant at 3.8% for the six months ended June 30, 2026 compared to the same period in 2025.

Previous wording

During the three months ended March 31, 2026, excluding the impact of equity-based compensation and related taxes, our expenses for selling, operations, technology, general and administrative activities decreased by $10 million, or 2.7%, compared to the same period in 2025. The decrease is primarily due to decreased compensation costs, driven by workforce reduction.

Current wording

During the six months ended June 30, 2026, excluding the impact of equity-based compensation and related taxes, our expenses for selling, operations, technology, general and administrative activities decreased by $19 million, or 2.6% compared to the same period in 2025. The decrease is due primarily to amortization expenses and compensation costs, partially offset by increases in technology spend.

Previous wording

During the three months ended March 31, 2026, restructuring and other charges, net decreased by $32 million, or 57.1%, compared to the same period in 2025. As a percentage of net revenue, restructuring and other charges, net decreased to 0.8% from 2.1% in the same period in 2025.

Current wording

During the six months ended June 30, 2026, restructuring and other charges, net decreased by $41 million, or 63.1%, compared to the same period in 2025. As a percentage of net revenue, restructuring and other charges, net decreased to 0.4% from 1.1% in the same period in 2025.

Previous wording

During the three months ended March 31, 2026, we incurred $24 million of charges related to a loss on termination of an operating lease for a logistics facility. During the three months ended March 31, 2025, we incurred $56 million of charges consisting primarily of one-time employee severance, benefits, relocation and transition costs. This is inclusive of $40 million related to the Germany Restructuring and $16 million related to the March 2025 workforce reduction.

Current wording

During the six months ended June 30, 2026, Wayfair incurred $24 million of charges related to a loss on termination of an operating lease for a logistics facility. During the six months ended June 30, 2025, Wayfair incurred $65 million of charges consisting primarily of one-time employee severance, benefits, relocation, and transition costs. This is inclusive of $46 million related to the Germany Restructuring and $19 million related to the March 2025 workforce reduction.

Previous wording

As of March 31, 2026, our principal source of liquidity was cash and cash equivalents and short-term investments totaling $1.1 billion. Additionally, we have a $500 million senior secured revolving credit facility that matures on March 13, 2030 (the “Revolver”). As of March 31, 2026, there were no revolving loans outstanding under the Revolver. We had outstanding letters of credit, primarily as security for certain lease agreements, for $90 million as of March 31, 2026, 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 June 30, 2026, our principal source of liquidity was cash and cash equivalents and short-term investments totaling $1.1 billion. Additionally, we have a $500 million senior secured revolving credit facility that matures on March 13, 2030 (the “Revolver”). As of June 30, 2026, there were no revolving loans outstanding under the Revolver. We had outstanding letters of credit, primarily as security for certain lease agreements, for $82 million as of June 30, 2026, 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

Further, we have and 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 (including through 10b5-1 plans). Such repurchases, exchanges or liability and dilution 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.

Current wording

We believe that our existing cash and cash equivalents and investments, cash generated from operations and the borrowing availability under our Revolver will be sufficient to meet our anticipated cash needs for at least the next twelve months from the date of the filing of this report including planned capital expenditures, contractual obligations and other requirements. However, our liquidity assumptions may prove to be incorrect, and we could exhaust our available financial resources sooner than we currently expect. We may elect to raise additional funds at any time through equity, equity-linked or debt financing arrangements. Further, we have and 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 (including through 10b5-1 plans). Such repurchases, exchanges or liability and dilution 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.

Previous wording

As of March 31, 2026, we had $3.0 billion principal amount of indebtedness outstanding. Our indebtedness includes:

Current wording

As of June 30, 2026, we had $2.9 billion principal amount of indebtedness outstanding. Our indebtedness includes:

Previous wording

•unsecured 3.50% Convertible Senior Notes due 2028 (the “2028 Notes”, and together with the 2026 Notes and 2027 Notes, the “Convertible Notes”);

Current wording

•unsecured 3.25% Convertible Senior Notes due 2027 (the “2027 Notes”); and, together with the 2026 Notes, the “Convertible Notes”);

Previous wording

•7.750% Senior Secured Notes due 2030 (the “2030 Secured Notes”); and

Current wording

•7.750% Senior Secured Notes due 2030 (the “2030 Secured Notes”);

Previous wording

•6.750% Senior Secured Notes due 2032 (the “2032 Secured Notes”and, together with the 2029 Secured Notes and the 2030 Secured Notes, the “Senior Secured Notes”, and the Senior Secured Notes, together with the Convertible Notes, the “Notes”).

Current wording

•7.125% Senior Secured Notes due 2034 ( the “2034 Secured Notes” and, together with the 2029 Secured Notes, 2030 Secured Notes, and 2032 Secured Notes, the “Senior Secured Notes”, and the Senior Secured Notes, together with the Convertible Notes, the “Notes”).

Previous wording

Between February 25, 2026 and March 4, 2026, we repurchased $56 million in aggregate principal amount of the 2028 Notes. See Note 4, Debt and Other Financing, included in Part I, Item 1, Financial Statements, in this Quarterly Report on Form 10-Q for additional information on debt and other financing transactions.

Current wording

Between February 25, 2026 and March 4, 2026, we repurchased $56 million in aggregate principal amount of the unsecured 3.50% Convertible Senior Notes due 2028 (the “2028 Notes”). Between April 1, 2026 and May 1, 2026, we repurchased $89 million in aggregate principal amount of the 2028 Notes. See Note 4, Debt and Other Financing, included in Part I, Item 1, Financial Statements, in this Quarterly Report on Form 10-Q for additional information on debt and other financing transactions.

Previous wording

On February 6, 2026, we issued a notice to holders of the 2027 Notes calling for redemption of $250 million principal amount of the outstanding 2027 Notes on or prior to March 23, 2026 (the “Redemption Date”). See Note 4, Debt and Other Financing, included in Part I, Item 1, Financial Statements, in this Quarterly Report on Form 10-Q for additional information on debt and other financing transactions.

Current wording

On February 6, 2026, we issued a notice to holders of the Company’s 2027 Notes calling for redemption of $250 million principal amount of the outstanding 2027 Notes on March 23, 2026 (the “2027 Notes Redemption Date”). On May 14, 2026, we issued a notice to holders of the Company’s 2028 Notes calling for redemption of the remaining $444 million principal amount of the outstanding 2028 Notes on June 29, 2026 (the “2028 Notes Redemption Date”). See Note 4, Debt and Other Financing, included in Part I, Item 1, Financial Statements, in this Quarterly Report on Form 10-Q for additional information on debt and other financing transactions.

Previous wording

The conditional conversion features of the 2028 Notes were triggered during the calendar quarter ended March 31, 2026, therefore the 2028 Notes are convertible during the calendar quarter ended June 30, 2026. The conditional conversion features of the 2026 Notes and 2027 Notes were not triggered during the calendar quarter ended March 31, 2026, therefore, the 2026 Notes and 2027 Notes are not convertible during the calendar quarter ended June 30, 2026 pursuant to the applicable last reported sales price conditions.

Current wording

The conditional conversion features of the 2026 Notes and 2027 Notes were not triggered during the calendar quarter ended June 30, 2026, therefore, the 2026 Notes and 2027 Notes are not convertible during the calendar quarter ending September 30, 2026 pursuant to the applicable last reported sales price conditions.

Previous wording

There were no conversions during the three months ended March 31, 2026 other than the conversion of the 2027 Notes on or prior to the Redemption Date. Whether any of the Convertible Notes will be convertible in future quarters will depend on the satisfaction of the applicable last reported sales price condition or another conversion condition in the future. If one or more holders elect to convert their Convertible Notes at a time when any such Convertible Notes are convertible, unless we elect to satisfy our conversion obligation by delivering solely shares of our Class A common stock (other than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity.

Current wording

There were no conversions during the six months ended June 30, 2026 other than the conversion of the 2027 Notes and 2028 Notes on or prior to the 2027 Notes Redemption Date and 2028 Notes Redemption Date, respectively. Whether any of the Convertible Notes will be convertible in future quarters will depend on the satisfaction of the applicable last reported sales price condition or another conversion condition in the future. If one or more holders elect to convert their Convertible Notes at a time when any such Convertible Notes are convertible, unless we elect to satisfy our conversion obligation by delivering solely shares of our Class A common stock (other than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity.

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 no more than 4.0 to 1.0, subject to a 0.5 step-up following certain permitted acquisitions. For information regarding our credit agreement and debt agreements, see Note 4, Debt and Other Financing, included in Part I, Item 1, Financial Statements, in this Quarterly Report on Form 10-Q and Note 6, Debt and Other Financing, included in Part II, Item 8, Financial Statements and Supplementary Data, in our Annual Report on Form 10-K for the year ended December 31, 2025. As of March 31, 2026 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 no more than 4.0 to 1.0, subject to a

Previous wording

Cash flows in connection with operating activities consisted of net loss adjusted for certain non-cash items including depreciation and amortization, equity-based compensation and certain other non-cash expenses, as well as the effect of changes in working capital and other activities. Operating cash flows can be volatile and are sensitive to many factors, including changes in working capital and our net loss.

Current wording

Cash flows in connection with operating activities consisted of net (loss) income adjusted for certain non-cash items including depreciation and amortization, equity-based compensation and certain other non-cash expenses, as well as the effect of changes in working capital and other activities. Operating cash flows can be volatile and are sensitive to many factors, including changes in working capital and our net (loss) income.

Previous wording

Cash flows used in operating activities decreased by $44 million during the three months ended March 31, 2026, compared to the same period in 2025, due to a decrease of $25 million for cash changes in operating assets and liabilities and an increase in net loss adjusted for non-cash items of $19 million. The decrease in cash flows used in operating activities was primarily driven by higher net revenue, and lower impairment and other restructuring costs from the prior year workforce reductions.

Current wording

Cash flows provided by operating activities increased by $131 million during the six months ended June 30, 2026, compared to the same period in 2025, due to an increase of $131 million for cash changes in operating assets and liabilities. The increase in cash flows provided by operating activities was primarily driven by higher net revenue, and lower impairment and other restructuring costs from the prior year workforce reductions.

Previous wording

Cash flows used in investing activities increased by $29 million during the three months ended March 31, 2026, compared to the same period in 2025, due to decreases in sales and maturities of short- and long-term investments of $31 million and increases in purchases of property and equipment and site and software development costs of $11 million, partially offset by a decrease in purchases of short- and long-term investments of $13 million.

Current wording

Cash flows used in investing activities increased by $42 million during the six months ended June 30, 2026, compared to the same period in 2025, due to decreases in sales and maturities of short- and long-term investments of $27 million and increases in purchases of property and equipment and site and software development costs of $27 million, partially offset by decreases in purchases of short- and long-term investments of $12 million.

Previous wording

Purchases of property and equipment and site and software development costs (collectively, “Capital Expenditures”) were 1.8% of net revenue for the three months ended March 31, 2026 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.

Current wording

Purchases of property and equipment and site and software development costs (collectively, “Capital Expenditures”) were 1.8% of net revenue for the six months ended June 30, 2026 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

Cash flows used in financing activities increased by $518 million during the three months ended March 31, 2026, compared to the same period in 2025. The increase in cash used is primarily due to decreases in proceeds from the issuance of debt of $691 million, increase in settlement of long-term debt of $250 million and payments of taxes related to net share settlement of equity awards of $29 million. These increases are partially offset by decreases in payments to extinguish debt of $452 million.

Current wording

Cash flows used in financing activities increased by $539 million during the six months ended June 30, 2026, compared to the same period in 2025. The increase in cash used is due primarily to increases in settlement of long-term debt of $701 million, decreases in proceeds from the issuance of debt of $296 million and increases in payments of taxes related to net share settlement of equity awards of $39 million. These increases are partially offset by decreases in payments to extinguish debt of $497 million.