US e-commerce third-quarter earnings preview: Industry growth remains steady, but Wayfair and eBay face high expectations

Has industry growth slowed?

Bernstein expects US e-commerce to grow about 8% year over year in the third quarter of 2026. A change in the timing of Prime Day weighed on growth for the quarter; viewed together, the second and third quarters grew about 10%.
The firm believes investor expectations for the sector’s third-quarter earnings are generally high. E-commerce stocks have also continued to perform strongly following recent discussion of AI agent shopping, and companies need to show whether transaction volumes can continue growing into 2027.

The furniture and housing markets as a whole are not growing, but Bernstein remains optimistic about Wayfair gaining share: growth is coming mainly from order volume rather than price increases. As the effects of membership rewards and stores gradually accumulate, the firm expects revenue growth of about 10% in 2027.
But investor expectations are high. Bernstein questions whether the stock can perform well on earnings day if third-quarter revenue does not grow 9%–10% and fourth-quarter guidance does not reach a similar level; its model forecasts growth of 8.5% in the third quarter and 9% in the fourth.
Profit is also a constraint: seasonal advertising costs lead the firm to see a fourth-quarter contribution margin ceiling of about 15%. It forecasts an overall gross margin of 29.7% for the second half of 2026 and believes overall gross-margin guidance needs to remain around 29.5%–30.5%.

Collectibles, automotive parts and accessories, transactions by individual sellers, and livestream commerce are driving US transaction growth. Bernstein expects eBay’s gross merchandise volume (GMV), excluding currency effects, to rise 14% and 12% year over year in the third and fourth quarters, respectively; meanwhile, competition from Whatnot and Vinted is also intensifying.
The company has already signaled that results will exceed its original guidance, while buy-side investors generally expect a GMV beat and an increase in guidance. The firm therefore believes the level of investment and operating profit growth are more likely to determine the earnings reaction.
Bernstein expects layoffs to save more than 200 million dollars annually, providing a cushion for margins in 2027 and helping fund investment in Depop. Its model forecasts approximately 6.5% organic GMV growth excluding currency effects and approximately 8.5% growth in non-GAAP operating profit in 2027.

Bernstein expects Etsy’s gross merchandise sales (GMS) to grow 6.5% year over year in the third quarter, slightly above the company’s guidance range; it forecasts 5% growth in the fourth quarter. Recent growth has been driven in part by higher average order values and improvements to the recommendation engine.
As the favorable comparison from higher average order values gradually fades, order volume becomes the key to growth in 2027. The firm believes that achieving the above-mid-single-digit GMS growth expected by bulls requires a visible path to low-single-digit order growth; fourth-quarter guidance will provide clues.
On profit, the announced layoffs affect 12% of employees. Bernstein expects them to improve operating efficiency and create room for investment; the improvement in marketing efficiency in the second quarter was also described as relatively durable.

Amazon beat expectations and raised guidance last quarter, but its shares subsequently came under pressure from factors including concern about the effect of AI agent shopping on advertising profits. Bernstein believes those concerns are overstated and that advertising still has room to grow; it also expects AWS revenue growth could catch up with Azure’s by the end-of-year exit rate, supported by demand, backlog and capacity expansion.
Bernstein forecasts Amazon’s third-quarter revenue at 205.932 billion dollars, 1.8% above sell-side consensus, and GAAP operating profit at 27.97 billion dollars, 7.4% above consensus. However, pressure on capital expenditure and free cash flow from new investments remains a risk identified by the firm.
Shopify’s AI narrative has shifted from concern early in the quarter that its payments model could be disrupted to the prospect of benefiting from AI-driven new business formation and the migration of large merchants. Bernstein remains positive but notes that valuation is already high, and AI costs, changes in the payments business mix and a rising share of large merchants could compress margins or rates.