And then I think that’s the answer.
Christopher Horvers: Thanks very much.
Operator: Your next question comes from the line of Maria Ripps with Canaccord. Your line is open.
Maria Ripps: Great. Good morning, and thanks for taking my question. I just wanted to expand on your Q4 guide. I guess, are you seeing any deceleration in consumer spending so far in Q4 versus Q3, or I guess what’s driving this sort of modest deceleration in year-over-year growth rate? Is that largely coming from lower prices? Or sort of — I guess, are you seeing any maybe consumers trading down to lower priced items or any weakness in large parcel purchases? If you can comment on that, that would be great.
Niraj Shah: Hi, Maria. It’s Niraj. Let me — so, I mean, I think your question is basically the year-over-year revenue growth number Q3 to Q4. And what I would say like first of you take a step back and look at what we’re guiding for Q4 compared to Q3. If you look at it sequentially, a normal holiday ramp is you’d expect Q4 to be bigger than Q3 by 9%, 10%, something like that as a holiday step up. And what you’ll see in our guide is we’ve stepped up revenue from Q3 to Q4 growing it by 7% or 8%, I think in the guide. And so we’re actually guiding the holiday ramp, but maybe you say a little muted, and but it’s in the normal band. And so why a little muted? Well, we’re in a promotional environment, and most of the revenue in the fourth quarter is always ahead of us, but in this case, we do it on a promotional adjusted basis.
It’s virtually all ahead of us. We’ve had one promotion so far, which was Way Day 2, which performed very well, in fact, beat our internal forecasts and expectations. So we’re seeing all the signs that say that will work, but we have that ahead of us. So we’re guiding it a little slightly muted, but still with an eye to say we think we’re going to do very well. There’s a lot of growth there and we’re going to take share. Now, year-over-year, your question is why does that compress then if you’re guiding it positively? And the answer is if you remember when we got the recipe back intact and we started taking share and we are back to good form. That was at the end of summer beginning of Q4 last year. So this Q4 will be the first year you’re comping year-over-year on us being back to a strong position.
The same Wayfair 19 years — 17, 18 years before COVID. We grew the business from zero share to the $9 billion we had in revenue pre-COVID. Well, so we are back intact, and we are growing. So the way to think about it is, of course, you’d have a slight kind of a compression of the year-over-year rate before it would then expand again. And what you really care about is, hey, are you taking market share? What’s the sequential customer number look like? Hey, where am I in this AOV annualizing? Because then the order growth is basically the revenue comp. And I think if you look at it that way, kind of analyze what’s the momentum in the business, you obviously see the momentum is gaining. If you look at it year-over-year, you then need to adjust for what happened in the third quarter last year, what happened in the fourth quarter last year.
I think that’s where the noise comes in. So I’d encourage you to look at it both ways. And I think if you look at it sequentially, you’d say, oh, wow, these guys are really and then what’s a tough market? These guys are really kind of moving along really well. They’re well-positioned for meaningful growth when the category recovers, and in the meantime, they’re getting significant share gains. It’s driven by the order strength. And on top of that, we talked about how we are committed to strong adjusted EBITDA regardless of the macro. So I think you’re seeing it all come together there.
Maria Ripps: Got it. That’s very helpful. Thanks so much.
Operator: Your next question comes from the line of Ygal Arounian with Citigroup. Your line is open.
Ygal Arounian: Yes, good morning, guys. Maybe just digging on the customers in AOV and the macro environment a little bit. As AOV normalizes here and you’re seeing that kind of deflationary point. Is — do you see that driving any of the incremental customer growth and order growth, meaning if price is normalizing, driving a better environment, if you could just parse that out a little bit? And then just did a good job kind of highlighting a lot of the questions of investors and one of the main ones that keeps coming up on our end from investors that you didn’t address is just on international and continuing to see headwinds there and challenges in late that market, still not getting back to normal. Maybe if you could address your views there and if that’s changed at all as we maybe get into a softer environment here? Thanks.
Niraj Shah: Sure. Let me start, and then, Kate, if you have anything, you can just jump in and add it. So let me do the first question first and then we’ll do the international one second. So first, I think you have a question around AOV normalization and does that drive order growth? I think the way to think about it is, the AOV normalization, what that is showing you is that things are getting back to normal. What does normal mean? It means that no retailer has an advantage over the other on relative price, relative availability, relative delivery capability other than what they themselves are doing, okay? During COVID, people had weird advantages depending on how they were set up were the brick-and-mortar or were they online?
Do they happen to buy inventory and carry 4 months of inventory, 3 months or 6 months normally versus that. Those are –those odd advantages because of the scarcity of goods have really abated. So everyone is in a great position now. Everyone is in a great position on price. Everyone is in a great position on availability. Everyone is in a great position on delivery. The question is what can they do with it? So now what you’re seeing is retailers are competing with each other, the same way, in our case, they would have from 2002 to 2019 on the strength of what they’re offering customers. And so now what you’re seeing are the results that basically show up based on everyone competing with each other and so who can put forward the best offer for the customer.
And it’s not necessary that online beats offline because in our data, we track about 90 folks, we only see 3 if you look back to the 2019 period through now, having taken share. You see us taking significant share, you see Amazon taking share, and you see home goods taking share. Home goods is really a brick-and-mortar retailer. In fact, they pulled out of online recently, but I think it was kind of a de minimis piece of their business, but they’re the ones they outcompete in Bed Bath. And as Bed Bath went out of business, they took that share. So there are different ways to get share. And that’s what you see playing out. So the way I encourage to think about it, we are in a tough recession environment, that’s 2 out of every 10 years. The market is down mid to high teens in dollars, there’s that deflation that everyone has.
So orders are not down by quite that much. But if you think there’s 10 points of deflation, orders might be down 5% or maybe 7%, maybe deflation is 12 points. And there’s some mix in there. But you see our orders up 14%. So you see us kind of gaining ground in the market. You see sequentially customers up 2%. So you’re seeing them increasingly picking us. You’re seeing that in the market share data. So think of it as we’re in a normal environment, and we’ve been for approximately a year. And what you’re now seeing is which retailers can take share in that environment. And if you track dozens and dozens of them listen to their strategies, you can see then in the results, how that’s playing out. And I think that’s going to continue to play out, both in this recession environment, but also as the category recovers, you’re going to say, who is well-positioned for meaningful growth.
That’s where you’re going to see that we’re very well poised for that. And so that’s what you’re going to see happen. But in the meantime, we’re going to keep taking share. And that’s why you say why are we committed to strong adjusted EBITDA regardless of the macro? The answer is, well, we’re gaining momentum and share in a tough market, and we have more cost savings coming. So we can do well now. But all that does is position you better for when things turn around and things really rip. And it’s all getting — its gaining us the — the share gain driven by order strength is really the thing to keep coming back to. Kate, anything on that before we go to that second part?
