Eyewear retailer Warby Parker’s direct listing begins trading on the New York Stock Exchange (NYSE) on Wednesday (Sept. 29) at an assigned reference price of $40 per share that could give the direct-to-consumer (D2C) firm a valuation as high as $5 billion, according to reports.
While sales have grown for the fashion-forward New York eyewear company in the past few years, so too have its losses.
In its S-1 filing with the Securities and Exchange Commission, the 11-year-old firm posted net revenue of $393.7 million in 2020, 6.3 percent higher than 2019. Losses, however, widened to $55.6 million, up from $1.7 million in 2019, PYMNTS reported.
Warby said that 60 percent of its net revenue in 2020 was from eCommerce. During the end of June of this year, online sales dropped to 50 percent. For all of 2021, Warby Parker expects sales growth of 36 percent to $537 million, in part helped by the opening of 30 to 35 new stores for a total of up to 160 locations.
See also: Warby Parker’s IPO Filing: Red Ink, And A Vision For D2C Eye Care
The $40 per share price is merely a guidepost, which is the norm for direct listings. The price doesn’t reflect the company’s market capitalization and no new shares are being floated, as would be the case in a traditional initial public offering (IPO).
Based on outstanding shares listed in the SEC filing, Warby Parker’s valuation would come in at an estimated $4.5 billion. Shares of the company traded privately in April at $24.53 each, per the filing.
In the past decade, Warby Parker has gone through nine funding rounds totaling more than $500 million, with its Series G in 2020 valuing the firm at an estimated $3 billion.
Some 95 percent of the company’s sales are glasses, with 23 percent coming from accessories, 2 percent from contact lenses and 1 percent from eye exams. The company expects that D2C telehealth, including vision, is tracking to exceed $16 billion by 2025, per the filing.
Read more: Warby Parker IPO Would Tap Dual Specialty Retail And D2C Trends
The company further estimated that it made sales to less than 2 percent of the U.S. population who use some type of corrective lenses. The Vision Council of America indicates that some 75 percent of Americans use corrective lenses, with 64 percent wearing glasses.
Warby Parker also recently teamed up with prestigious literary publication The Paris Review and is reviving the Roland frame in Jet Black and Brioche Tortoise, Esquire and other news outlets reported.
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