Warby Parker (NYSE: WRBY) reported Q2 2026 revenue of $235.5 million, up 9.8% from $214.5 million a year earlier, while diluted EPS improved to $0.04 from a loss of $0.01. GAAP net income reached $4.6 million and adjusted EBITDA rose to $32.9 million, although both included an $11.8 million tariff-refund benefit that also helped offset spending ahead of the Intelligent Eyewear launch. Quarterly operating cash flow was $29.6 million, with non-GAAP free cash flow of $6.8 million.
Core earnings data
For the quarter ended June 30, Warby Parker moved from operating and net losses to positive earnings. Gross margin recorded the largest change, but the improvement was driven mainly by tariff refunds rather than revenue growth alone.
| Metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Net revenue | $235.5 million | $214.5 million | +9.8% |
| Gross profit | $136.5 million | $113.6 million | About +$22.8 million |
| Gross margin | 57.9% | 53.0% | +490 bps |
| Operating income (loss) | $3.2 million | $(4.5) million | Loss to profit |
| Net income (loss) | $4.6 million | $(1.8) million | +$6.4 million |
| Diluted EPS | $0.04 | $(0.01) | Loss to profit |
| Adjusted EBITDA | $32.9 million | $25.0 million | +$7.9 million |
| Adjusted EBITDA margin | 14.0% | 11.7% | +230 bps |
| Operating cash flow | $29.6 million | Not provided | — |
| Free cash flow | $6.8 million | Not provided | — |
Adjusted EBITDA, adjusted EBITDA margin, and free cash flow are non-GAAP measures. The company’s adjusted gross margin was 58.1%, compared with 54.3% a year earlier.
Customer metrics and store expansion
Active customers increased 4.1% to 2.71 million on a trailing 12-month basis, while average revenue per customer rose 6.6% to $336. Growth in both the customer base and spending per customer was consistent with the quarter’s higher revenue.
Warby Parker opened 15 net new stores during Q2 and finished the period with 352 locations. The expansion added capacity but also increased doctor headcount and occupancy costs faster than revenue, creating fixed-cost pressure within gross margin.
Tariff refunds lifted gross margin while launch spending raised SG&A
Warby Parker recorded an $11.8 million benefit from IEEPA tariff refunds on inventory sold through June 30. The company said this added 500 basis points to Q2 gross margin. The year-over-year comparison also benefited by 110 basis points because Q2 2025 included one-time inventory write-downs associated with ending the Home Try-On program.
These gains were partly offset by the fixed costs of store expansion. Meanwhile, SG&A increased $15.2 million to $133.3 million and rose 150 basis points as a share of revenue to 56.6%. Retail compensation and technology spending ahead of the Intelligent Eyewear launch were the main drivers, partially offset by customer-experience efficiencies.
The result was a return to GAAP operating profit, but the quarter’s margin expansion should not be viewed as entirely recurring. The tariff benefit materially affected gross profit, net income, and adjusted EBITDA, while some of the proceeds were directed toward launch-related investments.
Cash flow and balance sheet
Quarterly operating cash flow of $29.6 million and free cash flow of $6.8 million included $3.4 million of tariff refunds and associated interest. Warby Parker ended June with $292.7 million of cash and cash equivalents, up from $286.4 million at the end of 2025. Inventory declined to $42.1 million from $44.5 million over the same period.
The first-half figures show a less favorable year-over-year cash-flow comparison. Operating cash flow for the six months ended June 30 was $54.1 million, down from $69.6 million, while purchases of property and equipment increased to $39.0 million from $32.4 million. The cash-flow statement included a $20.9 million use of cash from prepaid expenses and other assets, compared with a $1.1 million source a year earlier.
2026 guidance
Warby Parker reaffirmed its full-year outlook. The guidance includes a total tariff-refund benefit of $14.4 million, which the company is using to offset strategic investments during Q2 and the rest of the year.
| Metric | Latest guidance | Previous guidance | Change |
|---|---|---|---|
| Net revenue | $959 million-$976 million | $959 million-$976 million | Reaffirmed |
| Revenue growth | Approximately 10%-12% | Approximately 10%-12% | Reaffirmed |
| Adjusted EBITDA | $117 million-$119 million | $117 million-$119 million | Reaffirmed |
| Adjusted EBITDA margin | 12.2% | 12.2% | Reaffirmed |
| New store openings | 50 | 50 | Reaffirmed |
The projected adjusted EBITDA margin represents 130 basis points of year-over-year expansion. Importantly, the outlook includes known Intelligent Eyewear launch expenses but excludes any revenue contribution or broader demand benefit from the new category.
Management’s view
Management described Intelligent Eyewear as a major new product category and said the first collection would be unveiled within weeks. The products integrate Google Gemini and were developed in collaboration with Google and Samsung.
CFO Adrian Mitchell said Warby Parker is making targeted investments to prepare for the launch and build the capabilities needed to scale the category. The decision to exclude Intelligent Eyewear revenue from guidance creates a conservative revenue framework, but it also leaves the initial commercial contribution unquantified.
Recent insider transactions
The supplied insider data showed 1,027,462 shares classified as purchases across 20 transactions during the past six months, compared with 826,068 shares sold across 13 transactions. That produced net reported purchases of 201,394 shares, while total insider holdings were listed at 7.08 million shares.
Among the latest records with a specified direction and value, the following sales were reported after the quarter ended. These transactions do not by themselves indicate insiders’ views of the company’s prospects.
| Date | Insider | Role | Transaction | Price per share | Reported value |
|---|---|---|---|---|---|
| July 6, 2026 | Neil Harris Blumenthal | Co-CEO | Sale | $29.99 | $275,908 |
| July 6, 2026 | David Abraham Gilboa | Co-CEO | Sale | $29.84 | $1,621,714 |
| July 1, 2026 | Neil Harris Blumenthal | Co-CEO | Sale | $29.61 | $6,445,120 |
| July 1, 2026 | Jeffrey Jacob Raider | Director | Sale | $29.72 | $668,700 |
| July 1, 2026 | David Abraham Gilboa | Co-CEO | Sale | $29.69 | $7,191,541 |
Risks investors should monitor
- Tariff benefits may obscure underlying margin trends. The $11.8 million refund benefit added 500 basis points to Q2 gross margin, making it a material factor in the reported profitability improvement.
- Intelligent Eyewear costs are arriving before quantified revenue. Technology spending already contributed to higher SG&A, while the full-year outlook includes launch expenses but no associated revenue.
- Store expansion is increasing fixed costs. Doctor headcount and occupancy expenses grew faster than revenue during Q2, and the company still plans to open 50 stores during 2026.
- First-half cash conversion weakened year over year. Operating cash flow declined while capital expenditures increased, despite higher net income.
Summary
Warby Parker delivered higher revenue, more active customers, and positive GAAP earnings in Q2 2026. Tariff refunds were the main driver of margin expansion, while retail and technology investments limited some of that benefit. The next points to monitor are whether customer growth can keep pace with new-store costs, how Intelligent Eyewear spending develops, and whether the launch begins contributing revenue beyond the assumptions currently included in guidance.
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