Warby Parker Inc. (WRBY): Business Model Canvas [Dec-2025 Updated]

You're looking to dissect the current engine of Warby Parker Inc., and what you'll find is a company that has decisively moved beyond its direct-to-consumer roots to become a full-fledged omnichannel powerhouse. Honestly, the story here isn't just about selling glasses online anymore; it's about the strategic blend of 313 physical retail locations as of Q3 2025, aggressive tech innovation like AI tools, and a projected $871 million to $874 million in Net Revenue for the full year. This Business Model Canvas distills exactly how they maintain that accessible $95 price point while funding a massive retail expansion and supporting their social mission. It's a masterclass in modern retail evolution.

Warby Parker Inc. (WRBY) - Canvas Business Model: Key Partnerships

The Key Partnerships block for Warby Parker Inc. centers on strategic alliances that extend retail reach, advance product innovation, and amplify social impact.

Google and Samsung for developing AI-powered intelligent eyewear

Warby Parker Inc. is collaborating with Google and Samsung on the development of AI-powered smart glasses, built on the Android XR platform.

• Google has committed up to $75 million for Warby Parker Inc.'s product development and commercialization costs as of May 2025.
• Google has an additional commitment of up to $75 million in Warby Parker Inc. equity, subject to reaching certain collaboration milestones.
• The first line of intelligent eyewear from this partnership is planned to launch after 2025.

Target Corporation for five new shop-in-shop locations in 2025

The partnership with Target Corporation involves testing a new retail format, bringing Warby Parker Inc. expertise into select Target stores.

• Five 'Warby Parker at Target' shop-in-shops are slated to open in the second half of 2025.
• These initial locations will be in Illinois, Minnesota, New Jersey, Ohio, and Pennsylvania.
• Additional shop-in-shops are slated to open in 2026.
• This complements Target Optical, which offers services at more than 500 Target stores across the country.
• Warby Parker Inc. planned to open 45 total stores in the second half of 2025.

Versant Health (MetLife) for expanded in-network vision insurance coverage

Warby Parker Inc. is in-network with MetLife Vision, which utilizes Versant Health's Davis Vision and Superior Vision for network administration.

The company allows customers to check benefits instantly, applying coverage automatically for frames, contacts, or eye exams.

Global network of frame factories and logistics partners

The operational backbone relies on a global network for manufacturing and fulfillment, ensuring product availability across its growing physical footprint.

• Warby Parker Inc. ended Q2 2025 with 298 stores open.
• The company planned to open 45 new stores during the second half of 2025.
• One last-mile delivery logistics partner, Veho, consistently achieves over 99% on-time delivery (OTD).

Non-profit partners for the Buy a Pair, Give a Pair program

The social mission is executed through partnerships with non-profit organizations worldwide.

The Pupils Project, a domestic program component, reported specific metrics for 2024:

• 290,982 screenings administered.
• 57,817 eye exams provided.

Overall program milestones as of 2024:

The total number of pairs distributed through the Buy a Pair, Give a Pair program surpassed 20 million as of Q2 2025, according to a Co-CEO report.

Warby Parker Inc. (WRBY) - Canvas Business Model: Key Activities

You're looking at the core actions Warby Parker Inc. is taking right now to drive growth and maintain its market position as of late 2025. It's a mix of physical expansion, deep tech integration, and supply chain overhaul.

Aggressive Retail Store Expansion

Warby Parker Inc. is definitely still committed to its omnichannel strategy, using physical locations as a major customer acquisition channel. They are on track to open 45 new stores in 2025, which is a continuation of their aggressive physical footprint growth. By the end of the third quarter of 2025, the company was operating 313 retail stores across the U.S. and Canada. This expansion includes a new strategic channel: the introduction of the first wave of Warby Parker at Target shop-in-shops, with five locations debuting in the second half of 2025. The long-term ambition remains to operate 900 brick-and-mortar stores nationwide. The average store open for more than 12 months generated over $2.2 million in revenue with 35% 4-wall margins.

Vertical Integration

The company's vertically integrated model, covering designing, manufacturing, and distributing eyewear, is what allows them to maintain a competitive price point while capturing margin. This structure is evident in their financial performance, where the Trailing Twelve Month (TTM) gross margin stood at 54.39%. For the third quarter of 2025 specifically, the reported gross margin was 54.1%. This model helps them control the customer experience from start to finish, which is key to their value proposition. Still, gross margin saw slight pressure, dipping to 54.1% in Q3 2025 from 54.5% the prior year, partly due to tariffs.

Here are some key operational and financial metrics that reflect this integrated approach:

Developing AI-Powered Digital Tools and Smart Glasses Innovation

Warby Parker Inc. is actively pursuing what they call their 'third act' of innovation, heavily focused on artificial intelligence. A major activity is the development of AI-powered smart glasses in partnership with Google. The first product from this collaboration is planned to launch after 2025. Google has committed up to $75 million for Warby Parker Inc.'s product development and commercialization, plus an additional potential $75 million investment contingent on milestones. On the digital tools front, they launched the Warby Parker Advisor AI tool, which uses a face scan in the iOS app to give personalized frame recommendations.

Providing Comprehensive In-Store and Virtual Eye Exams and Services

The company is increasingly focused on its role as a holistic eye care business, which includes providing vision exams. Revenue generated from eye exams increased by 44% year-over-year in the second quarter of 2025, and now accounts for 6% of total revenue. This service is offered both virtually and in their physical stores. By the end of 2024, Warby Parker Inc. had expanded eye exam capabilities to 85% of its retail locations. The growth in services is outpacing product sales growth in some periods; for instance, contact lens revenue grew 28% in Q2 2025, representing 11.5% of revenue.

Managing a Diversified, Global Supply Chain and Inventory

A critical activity involves actively managing the supply chain to mitigate risks, particularly from tariffs. Warby Parker Inc. expects to significantly reduce its reliance on China for sourcing. Management has stated an expectation to reduce China sourcing to less than 10% of the Cost of Goods Sold (COGS) by the end of 2025, down from about 20% currently. This is being achieved by reallocating frame production to other partners in Europe and Asia, and moving a significant portion of lens sourcing to US partners. The company maintains a healthy balance of frame inventory to support its operations.

Key supply chain shifts as of late 2025 include:

• China sourcing target for COGS: under 10% by year-end 2025.
• Frame production reallocated to partners in Europe and Asia.
• Significant lens sourcing moved to US partners.
• Tariff mitigation also involved selective price increases across some lens types and accessories.

Finance: draft 13-week cash view by Friday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Key Resources

Strong, purpose-driven brand equity and mission are central. The brand's commitment includes distributing a pair of glasses to someone in need for every pair sold. As of Q3 2025, the company's market capitalization stood at approximately $2.07 billion or $2.32 billion, depending on the reporting source. Full-year 2025 net revenue guidance is set between $871 million and $874 million.

Proprietary technology like Virtual Try-On and AI personalization is a growing asset. Warby Parker Advisor, an AI tool built on proprietary technology, offers personalized frame recommendations following a quick face scan in the iOS app. Furthermore, the partnership with Google to develop AI-powered glasses includes a commitment from Google of up to $150 million, split between a $75 million equity investment and up to $75 million for product development and commercialization costs. The first line of intelligent eyewear is anticipated for launch after 2025.

Warby Parker operates vertically integrated optical labs in New York and Las Vegas to control manufacturing. The New York lab, established in 2016, is now a 52,000-square-foot facility. The second facility, located in Las Vegas, is a 69,000-square-foot warehouse.

You need to factor in the physical footprint. The network of physical retail stores reached 313 locations as of Q3 2025. The company was on track to open 45 new stores in 2025, including five shop-in-shops at Target locations.

The customer base is a core resource, showing consistent growth. The active customer base, measured on a trailing 12-month basis as of Q3 2025, was 2.66 million. Average Revenue per Customer for the same period increased to $320.

Here's a quick look at the physical and customer scale:

The operational capabilities are supported by these tangible assets, which include:

• The 52,000-square-foot optical lab in New York
• The 69,000-square-foot optical lab in Las Vegas
• The Warby Parker Advisor tool, leveraging proprietary AI technology
• The Google partnership with a $150 million commitment

If onboarding for new store openings takes longer than planned, you'll see a delay in capturing the expected revenue lift from the planned 45 new stores for 2025. Finance: draft 13-week cash view by Friday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Value Propositions

Designer-quality prescription glasses start at an accessible price point of $95. This entry price includes prescription lenses with scratch-resistant, anti-reflective, and superhydrophobic treatments, plus 100% UVA and UVB ray blocking. While the entry price is maintained, the company made a handful of targeted price increases across some lens types and accessories in April 2025, resulting in an estimated low single-digit price increase across the glasses business in aggregate. Frames with progressive lenses begin at $325.

The omnichannel convenience is supported by a growing physical footprint. As of the third quarter of 2025, Warby Parker operated 313 stores, with management noting a potential footprint of over 900 locations. In the second quarter of 2025, retail revenue grew 19.3% year-over-year, while e-commerce revenue grew 2% year-over-year. Stores open more than 12 months averaged $2.2 million in revenue with 35% 4-wall margins in Q2 2025.

The social impact proposition, Buy a Pair, Give a Pair, has resulted in over 20 million pairs of glasses distributed to people in need as of the second quarter of 2025. Through the Pupils Project, over 290,000 pairs have been distributed to schoolchildren in the United States.

Comprehensive vision care is expanding its share of the business. In the third quarter of 2025, eye exam revenues jumped 41%, accounting for 6.5% of total revenues, up from 5.3% the prior year. Contact lenses grew 28% in Q2 2025 and represented 11.5% of total revenue.

Innovation is centered on a "third act" of development, including a long-term partnership with Google to develop AI-powered intelligent eyewear.

Here's a quick look at key operational metrics supporting these value propositions as of late 2025:

You can see the growth in the service side of the business:

• Eye exam revenue share: 6.5% of total revenue in Q3 2025.
• Contact lenses revenue share: 11.5% of total revenue in Q2 2025.
• Progressives accounted for approximately 23% of prescription units sold in Q2 2025.

The commitment to the physical channel is clear, even with the digital focus. The company is on track to open 45 new stores for the full year 2025, including five shop-in-shops at select Target locations.

Warby Parker Inc. (WRBY) - Canvas Business Model: Customer Relationships

Personalized service from in-store optical staff and online customer experience teams.

The physical retail channel is now the primary growth engine for Warby Parker Inc. (WRBY). As of the third quarter ended September 30, 2025, the retail channel represented 73% of the overall business. Warby Parker Inc. (WRBY) ended Q3 2025 with 313 stores, having opened 15 net new stores during that quarter alone. These locations are staffed with opticians who provide vision exams and consultations, which drives professional service relationships. Specifically, 275 stores now feature exam suites, which is 88% of the entire fleet. Revenue from eye exams grew 41% year-over-year in Q3 2025. Online customer experience teams support this by accessing customer accounts via the self-built sales software, Point of Everything, which includes browsing histories and prescriptions, helping to create a seamless omnichannel experience.

High-tech digital engagement via Virtual Try-On and AI tools.

Warby Parker Inc. (WRBY) is leaning heavily into digital tools as the Home Try-On program winds down. The company recently launched an AI-powered shopping assistant called 'Advisor' in its iOS app, which co-CEO Neil Blumenthal noted has strong early traction and is increasing conversion. Virtual Try-On (VTO) technology, which uses augmented reality (AR), is a key focus for the digital experience. While specific Warby Parker Inc. (WRBY) VTO adoption rates aren't public, industry research suggests that AR try-ons can lead to a 200% rise in user interaction and up to a 30% increase in conversions for retailers using the technology. This focus on AI and AR is part of their 'Act 3' strategy.

Direct, transparent communication inherent to the DTC model.

The direct-to-consumer (DTC) nature inherently supports transparent communication regarding value. Warby Parker Inc. (WRBY)'s gross margin for Q3 2025 stood at 54.1%. The company reports its active customer base grew 9.3% year-over-year in Q3 2025, reaching 2.66 million customers, with an Average Revenue per Customer (ARPC) of $320 for the trailing twelve months ending in Q3 2025. This direct relationship allows for clear communication on pricing and product mix, such as the impact of tariffs on the gross margin, which was noted as a driver for the slight decrease from 54.5% in the prior year period.

Phasing out the Home Try-On program by late 2025 to focus on AR and stores.

Warby Parker Inc. (WRBY) is sunsetting its signature Home Try-On program by the end of 2025. This decision was made because the vast majority of recent Home Try-On users live within 30 minutes of one of the company's retail locations. The program, which once shipped five frames free for five days, is estimated by one consultant to save the company almost $100M per year by discontinuing it. The company is reallocating resources to its physical footprint and digital advancements. For context, in 2021, Warby Parker Inc. (WRBY) stated the Home Try-On program achieved an impressive 75% conversion rate.

Here's the quick math on the channel shift:

• Ending FY2025 on track to open 45 new stores.
• Q3 2025 retail revenue growth was 20.2% year-over-year.
• Q2 2025 e-commerce revenue growth was 2% year-over-year.
• The company plans to open five shop-in-shops at Target locations in the second half of 2025.

You can see the shift in focus clearly in the performance metrics:

Finance: draft 13-week cash view by Friday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Channels

You're looking at how Warby Parker Inc. gets its product-stylish, affordable eyewear-into the hands of customers as of late 2025. The strategy is definitely omnichannel, blending digital convenience with physical presence.

The core of the direct-to-consumer (DTC) approach remains the e-commerce platform, which includes their website and mobile app. This channel supports the Virtual Vision Test, allowing customers to renew prescriptions from home if their vision hasn't changed, which is a key part of their digital service offering.

The physical footprint is substantial and growing. As of the third quarter of 2025, Warby Parker Inc. operated 313 locations across the U.S. and Canada. This physical expansion is a major driver of recent growth; retail revenues grew by 20.2 percent year-over-year in Q3 2025, driven by a 16.4 percent new store expansion. Management believes there is long-term potential for more than 900 stores.

The company is actively testing new physical formats. They started a partnership with Target Corporation, launching shop-in-shops branded as Warby Parker at Target. The initial rollout involved five locations opening in the second half of 2025. These locations offer a full suite of products and services, including eye exams. Management expects to open a similar number of these Target shop-in-shop locations in 2026. This complements Target's existing Target Optical business, which is in more than 500 Target stores nationwide.

The service component is integrated across channels. In-store eye exam and vision service centers are available at most Warby Parker Inc. retail locations. Furthermore, the new Target shop-in-shops also provide prescription glasses, contacts, eye exams, and vision tests, staffed by Warby Parker Inc. employees.

The direct shipping and logistics network handles the fulfillment of online orders. While the overall gross margin slightly dipped to 54.1 percent in Q3 2025, increased customer shipping costs were cited as a contributing factor.

Here's a quick look at how the two main sales channels performed in Q3 2025:

The company's strategy clearly favors physical expansion, given that retail sales drive the majority of revenue. You can see the focus on physical touchpoints, from their own stores to the new Target integrations, is where the immediate revenue lift is coming from.

The omnichannel experience is supported by several key service offerings available through these channels:

• Frames starting at $95, including prescription lenses.
• Offering of prescription glasses, sunglasses, and contacts.
• Insurance integration to increase customer acquisition.
• Complimentary adjustments for life on every frame purchased in-store.

Finance: draft 13-week cash view by Friday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Customer Segments

You're looking at the core of Warby Parker Inc.'s growth engine as of late 2025. The customer base is broad, but we can segment the appeal based on recent financial performance and management commentary.

The foundation is the existing base of 2.66 million active customers as of the third quarter of 2025. This base is showing strong retention, with some cohorts demonstrating sales retention exceeding 100% even 48 months post-purchase, which suggests existing customers are spending more over time. Also, the Average Revenue per Customer (ARPC) hit $320 in Q3 2025, up 4.8% year-over-year.

Value-conscious consumers are definitely still a target, especially given the economic environment. This group is attracted by the proposition of high-quality eyewear at a lower price point than traditional optical shops. This is evidenced by the mix shift; management noted that younger customers are increasingly selective, leaning toward the entry-level $95 frames offering. Still, Warby Parker Inc. only represents approximately 1% market share within the massive $68 billion U.S. eyewear market, showing significant room for value-driven acquisition.

Here's a quick look at the key customer metrics driving the business model as of Q3 2025.

Younger, digitally-native customers remain a key segment, though they are showing more caution. Leadership noted that this group is being more selective in purchasing behavior. This caution is reflected in the mix shift towards the lower-priced $95 frames and a moderation in contact lens and glasses orders. These customers are comfortable with the online purchasing experience, which Warby Parker Inc. supports with virtual try-on technology.

Customers with vision insurance are an increasingly important segment, as using benefits removes a major historical barrier to purchase. By the end of 2024, Warby Parker Inc. had already expanded its in-network coverage to over 30 million lives, largely through partnerships like the one with Versant Health. Insurance customers are showing higher engagement, often purchasing higher-value items like progressive lenses.

Socially conscious buyers are attracted to the core mission: for every pair of glasses sold, a pair is distributed to someone in need. This mission is central to the brand's identity, though specific financial metrics tracking the impact of this segment versus others aren't broken out in the latest reports. Still, the company is well-positioned to take share in any environment because of this differentiated value proposition.

You should review the Q4 2025 guidance impact on customer acquisition cost projections by next Tuesday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Cost Structure

You're looking at the expenses driving Warby Parker Inc.'s operations as of late 2025. The cost structure is heavily influenced by physical retail presence, product sourcing, and new technology investments.

The company ended the third quarter of 2025 with 313 retail locations, including the first five shop-in-shops at select Target locations. Store occupancy and operating costs are a significant component of the overall expense base, with these costs cited as a factor contributing to gross margin pressure in Q1 2025.

The Selling, General, and Administrative (SG&A) expenses show a move toward leverage, though marketing spend is still a factor. For Q3 2025, Adjusted SG&A was reported at $108.0 million, representing 48.7% of revenue, which was an improvement from 52.3% of revenue in the prior year period.

Cost of Goods Sold (COGS) is directly impacted by product mix and supply chain management. The Gross margin for Q3 2025 stood at 54.1%. This margin faced pressure from factors like tariffs on frames and increased customer shipping costs, though it was partially supported by sales growth in contacts and higher penetration of precision progressives and lens enhancements. Management noted efforts to reduce COGS exposure by aiming to reduce China sourcing to less than 10% of COGS by the end of 2025, down from about 20% previously.

Marketing and customer acquisition expenses are embedded within the SG&A structure, with growth in marketing partially offsetting other expense leverage within SG&A.

Research and development costs are being significantly bolstered by external investment related to the AI and smart glasses technology push. Google committed up to $150 million for this effort, structured as $75 million in immediate R&D cash, with an additional $75 million contingent on hitting specific collaboration milestones. The first line of intelligent eyewear is planned for launch sometime after 2025.

Here's a quick look at the key Q3 2025 cost-related financial figures:

The company is actively managing its physical footprint, ending Q3 with 313 stores, while simultaneously allocating capital toward future product categories.

• Store count growth in Q3 2025: 15 net new stores opened.
• Active Customers ending Q3 2025: 2.66 million.
• China sourcing target for COGS by end of 2025: less than 10%.
• Total Google partnership funding for AI glasses: $150 million.

Finance: draft 13-week cash view by Friday.

Warby Parker Inc. (WRBY) - Canvas Business Model: Revenue Streams

You're looking at the core ways Warby Parker Inc. brings in cash as of late 2025. The model is heavily weighted toward the core product, but the services side is growing fast.

The primary revenue driver remains the sale of prescription eyeglasses, which is cited as making up approximately 85% of total revenue. Following that, you see the sales of contact lenses, generally accounting for approximately 7-10% of revenue. Revenue from eye exams and vision services is a smaller, but rapidly increasing, component, estimated at approximately 3% of revenue.

Looking at the latest full-year projection, Warby Parker Inc. has set its full-year 2025 Net Revenue guidance between $871 million to $874 million. This reflects a projected growth of approximately 13% over the prior year. Furthermore, the Average Revenue per Customer, measured over the trailing 12 months ending in Q3 2025, stands at $320.

To give you a more granular view based on the Q3 2025 actuals, here is how the product mix looked:

The growth in the service and recurring revenue segments is notable. For instance, in the third quarter of 2025, revenue from eye exams jumped by 41% year-over-year, and contact lens sales grew by 21% year-over-year. This shows the services are outpacing the core product growth rate, which is a defintely interesting trend for future valuation.

Here are some key metrics related to customer value and revenue generation as of the Q3 2025 reporting period:

• Active Customers reached 2.66 million on a trailing 12-month basis.
• Average Revenue per Customer increased 4.8% year over year to $320.
• The company is on track to open 45 new stores for the full year 2025.
• Gross margin for Q3 2025 was 54.1%.

The increase in ARPC to $320 is partly due to selective price increases on glasses implemented in the second quarter and increased penetration of higher-value items like precision progressives and other lens enhancements.