Wayfair follows the two-class method when computing earnings or loss per share for its two issued classes of common stock - Class A and Class B. Basic earnings or loss per share is computed using the weighted-average number of shares of common stock outstanding during the period. Diluted earnings or loss per share is computed using the weighted-average number of shares of common stock outstanding during the period plus, if dilutive, common stock equivalents outstanding during the period and stock issuable upon conversion of the convertible debt instruments. Wayfair's common stock equivalents consist of shares issuable upon the release of restricted stock units and performance stock units. The dilutive effect of these common stock equivalents is reflected in diluted earnings or loss per share by application of the treasury stock method. The dilutive effect of shares issuable upon conversion of the convertible debt instruments are included in the calculation of diluted earnings or loss per share under the if-converted method.

For periods in which Wayfair has reported net losses, diluted loss per share is the same as basic loss per share, as the effects of common stock equivalents outstanding and shares issuable upon conversion of convertible debt instruments are antidilutive and therefore excluded from the calculation of diluted loss per share.

Wayfair allocates undistributed earnings between the classes on a one-to-one basis when computing earnings or loss per share. As a result, basic and diluted earnings or loss per share per Class A and Class B shares are equivalent.

The following table presents the calculation of basic and diluted (loss) earnings per share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025

	(in millions, except per share data)
Numerator:
Numerator for basic and diluted (loss) earnings per share - net (loss) income	$	(1)	$	15	$	(106)	$	(98)



Denominator:
Denominator for basic (loss) earnings per share - weighted-average number of shares of common stock outstanding	132		128		131		127
Effect of dilutive securities:
Restricted stock units	—		1		—		—



Denominator for diluted (loss) earnings per share - weighted-average number of shares of common stock outstanding after the effect of dilutive securities	132		129		131		127
(Loss) earnings per share
Basic	$	(0.01)	$	0.11	$	(0.81)	$	(0.77)
Diluted	$	(0.01)	$	0.11	$	(0.81)	$	(0.77)


		Three Months Ended June 30,		Six Months Ended June 30,
		2026	2025	2026	2025
	(in millions)


Unvested restricted stock units		3	3	3	3
Unvested performance stock units		5	—	5	—
Shares related to convertible debt instruments		4	27	4	27
Total		12	30	12	30

Wayfair may settle conversions of the Convertible Notes in cash, shares of Wayfair’s Class A common stock or any combination thereof at its election. The Capped Calls are generally expected to reduce the potential dilution of Wayfair's Class A common stock upon any conversion of the Convertible Notes and/or offset the cash payments Wayfair is required to make in excess of the principal amount of the Notes upon conversion of the Convertible Notes to the extent the market price per share of Wayfair’s Class A common stock is greater than the strike price of the Capped Calls (which corresponds to the initial conversion prices of the Convertible Notes, subject to certain adjustments under the terms of the Capped Calls), with such reduction and/or offset capped at the Initial Cap Price.