What Wayfair Inc. told the SEC could break it.

A substantial portion of Wayfair's products are manufactured in China; disruption, import restrictions or tariffs on Chinese-made furniture and home goods could raise costs or reduce supply available to customers.

“A substantial portion of our products are manufactured in China. We continue to work with our suppliers to mitigate any exposure to current, scheduled, and any other potential tariffs and are seeking opportunities to engage with new suppliers outside of China, but there can be no assurance that we will be able to offset any increased costs or secure these new suppliers.”

Expanded U.S. tariffs on Chinese furniture, home goods and derivative products (steel/aluminum/wooden seating, cabinets, vanities), elimination of the China de minimis exemption, and stacked tariffs have raised Wayfair's effective tariff rates, with retaliatory tariffs from China and Canada.

“has continued to impose additional and expanded tariffs on imports from specific countries such as China, including furniture, home goods, and related components, has expanded tariffs on imports on specific sectors and product types and derivative products, such as those made of steel, aluminum and certain wooden upholstered seating, cabinets and vanities, and has eliminated the prior de minimis exemption for small-value shipments from China. These actions have resulted in higher effective tariff rates, including certain stacked tariffs on certain home-goods categories.”

Wayfair primarily relies on a single carrier, FedEx, for delivery of its small-parcel products, creating a single-carrier dependency for a key part of fulfillment.

“Additionally, we primarily rely on a single carrier, FedEx, for the delivery of our small parcel products, and third party national, regional and local transportation companies deliver a portion of our large parcel products, including through our Wayfair Delivery Network.”

International operations (~12% of net revenue: Canada, UK, Ireland) expose Wayfair to translation risk on the British Pound, Euro and Canadian Dollar; the company does not currently hedge.

“Our operating expenses are denominated in the currencies of the countries in which our operations are located or in which net revenue is generated, and as a result we face exposure to adverse movements in foreign currency exchange rates, particularly changes in the British Pound, Euro and Canadian Dollar, as the financial results of our international operations are translated from local currency, or functional currency, into U.S.”