Wish Founder and CEO Piotr Szulczewski said Thursday (Aug. 12) his company is keenly aware of the reasons it turned in a quarterly performance that showed a 6 percent drop in revenue from the previous year, but it will likely take until the fourth quarter of the year to fully rebound.
The eCommerce platform, formally known as ContextLogic Inc., saw an overall year-to-year revenue dip from $701 million to $656 million in the second quarter of the year, which ended June 30, 2021. Core marketplace revenue took the biggest hit, down 32 percent from $555 million to $378 million, while marketplace revenue dipped 29 percent from $600 million to $428 million.
Logistics revenue rose 126 percent from $101 million to $228 million in the second quarter, while ProductBoost, Wish’s advertising tool for merchants, was up 11 percent $45 million to $50 million.
“Wish has begun executing on initiatives designed to enhance the user experience and increase engagement on the Wish app following second-quarter results that did not meet our expectations,” Szulczewski said in the company announcement. “We are working hard to improve our performance and are confident that Wish will emerge as a stronger business.”
In the company’s quarterly earnings call, Szulczewski said Wish’s user retention dropped despite its increased focus on logistics. He expects it to be “several quarters” before the benefits of the improved logistics are realized in the company’s earnings statements.
The second quarter of 2021 paled in comparison to the same period a year earlier in part because of the COVID-19 pandemic, which kept people at home and engaged in eCommerce more than in-store shopping. Daily user activity and active buyers fell in Q2, with a 13 percent drop in app installs and 15 percent dip in the time spent on the Wish platform as compared to 2020.
Related: eBay Transformation Runs Up Against Increased eCommerce Competition
In separate news, eBay reported this week that active buyers fell 2 percent year over year in the second quarter of 2021 and gross merchandise volume dropped 11 percent from the previous three months. Chief Financial Officer Steve Priest blamed the decline on consumers’ increased mobility as the COVID-19 pandemic wanes, echoing what Amazon executives said last month about their eCommerce sales deceleration.
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