Company: WRBY
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001504776-25-000019
Chunk: 45

Company: Warby Parker Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 45
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Cost of Goods Sold, Gross Profit, and Gross Margin

Three Months Ended March 31,20252024$ Change% Change(in thousands)Cost of goods sold$97,802 $86,544 $11,258 13.0 %Gross profit125,980 113,459 12,521 11.0 %Gross margin56.3 %56.7 %(0.4)%

Cost of goods sold increased by $11.3 million, or 13.0%, for the three months ended March 31, 2025 compared to the same period in 2024, and increased as a percentage of revenue over the same period, from 43.3% of revenue to 43.7% of revenue. The increase in cost of goods sold was primarily driven by increased product and fulfillment costs associated with our sales growth, particularly related to the growth in our contact lens offering, as well as increases in store occupancy costs and doctor headcount due to new retail stores opened in 2024 and the first three months of 2025.

Gross profit, calculated as net revenue less cost of goods sold, increased by $12.5 million, or 11.0%, for the three months ended March 31, 2025 compared to the same period in 2024, primarily due to the increase in net revenue over the same period.

Gross margin, expressed as a percentage and calculated as gross profit divided by net revenue, decreased by 40 basis points for the three months ended March 31, 2025 compared to the same period in 2024. The decrease in gross margin was primarily driven by the sales growth of contact lenses, which are sold at a lower margin than our other eyewear, and increased store occupancy costs as the number of stores grew from 245 at March 31, 2024 to 287 at March 31, 2025. These impacts were partially offset by increased penetration of our higher priced frames and lenses and lower outbound customer shipping costs as a percent of revenue.

Selling, General, and Administrative Expenses

Three Months Ended March 31,20252024$ Change% Change(in thousands)Selling, general, and administrative expenses$123,509 $118,586 $4,923 4.2 %As a percentage of net revenue55.2 %59.3 %(4.1)%

Selling, general, and administrative expenses increased $4.