Warby Parker Achieves First Profitable Year with Accelerating Growth, Launches $100M Share Repurchase Program

Profitability Milestone: First Full Year of Positive Net Income and Expanded EBITDA

Warby Parker (NYSE: WRBY) has reached a crucial milestone, posting its first full year of positive net income for 2025. The company reported $1.6 million in net income, a sharp turnaround from a $20.4 million loss in 2024. Adjusted EBITDA climbed by 30.2% to $95.2 million, with the EBITDA margin improving by 140 basis points to 10.9%. This leap in profitability marks a turning point for the direct-to-consumer eyewear brand as it continues to scale both revenue and operating efficiency.

Sustained Revenue Growth and Expanding Customer Metrics

Revenue growth remained robust for both the full year and the fourth quarter. Annual net revenue rose 13% to $871.9 million, while fourth-quarter sales grew 11.2% year-over-year to $212.0 million. Customer metrics also reflected momentum: Active customers advanced 7%, and average revenue per customer increased 5.7% to $324—signaling higher customer engagement and effective upselling strategies.

Disciplined Expense Management and Improving Margins

In a year with rising sales and new store openings, Warby Parker managed to drive operating leverage across its cost structure. Selling, general, and administrative expenses (SG&A) as a percentage of revenue shrank from 59.2% in 2024 to 54.6% in 2025. Adjusted SG&A landed even lower at 49.7% of revenue, benefiting from efficiencies in corporate spending and customer operations as well as lower stock-based compensation.

Gross margin for the year was 54.0% (down modestly from 55.3%), impacted primarily by tariffs, higher doctor headcount, and growth in contact lens sales—partly offset by selective price increases and improved sales mix in higher-margin eyewear.

Cash Flow Strength and Shareholder Capital Returns

2025 marked Warby Parker's third consecutive year of positive operating cash flow and free cash flow, finishing with $110.8 million in operating cash and $43.7 million in free cash flow. The company ended the year with $286.4 million in cash and equivalents—providing ample flexibility to fund growth and return capital to shareholders.

Reflecting that strength, Warby Parker’s board authorized a $100 million share repurchase program in February 2026, signaling confidence in long-term prospects and providing downside support for the stock. Repurchases can be made in the open market or privately, at management’s discretion, with no expiration date or required minimum.

Guidance for 2026: Growth Outlook Remains Firm with Store Expansion

Management offered a confident forecast for 2026, projecting net revenue between $959 and $976 million (10-12% annual growth) and adjusted EBITDA of $117–$119 million, with a margin target of 12.2%. The plan includes 50 new store openings, further expanding its national footprint. Warby Parker’s continued investment in innovation, including AI-driven in-store and digital experiences, is positioned to drive future engagement and operational efficiency.

Key Takeaway: Warby Parker Shows Strength, Upside Supported by Cash and Buyback

With its first-ever annual profit, robust free cash flow, and an ambitious growth agenda backed by a substantial buyback, Warby Parker appears well-positioned for continued expansion. Investors and watchers may want to focus on the company’s ability to execute its store rollout, navigate margin pressures, and turn digital initiatives into incremental sales and efficiencies over the coming year. For now, WRBY is showing solid evidence of moving from startup promise to the next phase of durable, profitable growth.

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