The one company that WISHes they didn’t have to report earnings

Hey everyone.

Today’s DD is for one of WSB’s most popular meme stocks : WISH.

Brief summary of WISH from Wikipedia:

Wish is operated by ContextLogic Inc. in San Francisco, United States. The platform employs browsing technologies which personalise shopping visually for each customer, rather than relying on a search bar format. It allows sellers to list their products on Wish and sell directly to consumers. Wish works with payment service providers to handle payments and does not stock the products themselves or manage returns.

Essentially, they are a middle man that connects sellers to buyers. Their ideal demographic is people who are willing to risk quality for the sake of discounted prices. It may sounds funny and a “why would anyone buy anything off WISH”, but it’s become lucrative enough for them to be a multibillionaire company today.

With their earnings coming up, I thought it’d be a great idea into digging up some information to best predict how they’re going to perform in q3. In doing so, I’d like to present some hard data so we can pin point the most likely outcome.

1 Last quarter earnings report

If you read their earnings report, they missed HARD on their revenue mark citing two major headwinds: rising advertising costs (due to iOS change) and vaccines beginning to encourage shoppers to go out and purchase goods elsewhere. To combat this, their gamble for Q3 goes as follows:

  1. Enhancing product quality and selection. Wish users should always feel satisfied with their purchases. As we improved logistics, product-quality issues became the number one reason for customer service requests. Under a new quality score system, we are now prioritizing products and merchants that receive positive ratings and
    feedback from our users. We also are adding more globally-recognized brands and items that users know and search for, which we believe will drive more frequent purchases and higher average order values. Since Wish was built as a discovery-based ecommerce shopping experience, we are focusing product selection on categories like
    apparel, home goods, and gadgets that translate well into an “online treasure hunt” experience. We will leverage our user activity data to strategically select attractively priced, quality products that we believe will delight our users.

  2. Providing an unmatched fun and entertaining shopping experience. Wish users should always experience a fresh feed that elicits a joyful feeling, as if they have entered a store that prominently displays only products that pique their interests. To meet those expectations, we are investing further in our platform and data-science capabilities to develop a more engaging, personalized, and discovery-based online shopping experience for our users. We are
    leaning into social commerce and entertaining features, such as video reviews and live streaming shopping events with the goal of engaging users and increasing time spent on the Wish app. Over time, we expect these innovations to drive new buyer conversion and existing buyer retention, and to encourage more frequent usage.

  3. Improving the performance of the app. Since Wish was built on a culture of innovation and experimentation, there have been a high number of ongoing platform tests designed to advance innovation. However, the volume of those tests resulted in a slowdown, or latency, of the app’s speed. The slower platform performance impacted the user experience, particularly for our existing users. We have since conducted a thorough review and cleanup of all open tests and this has already resulted in significant latency improvement. Going forward, we will strive to more effectively balance platform testing to advance innovation with the need to maintain optimal platform performance for our users

I share this not to repeat the same shit of “haha they missed earnings” but there is a HUGE underlying message many people have missed here. In this section, as well as other parts of the report, is a self-admission of “we do not expect new user growth.” Instead, they are banking on making making more money off each existing user.

This is extremely difficult, because it assumes they will not bleed any users while also increasing revenue per user.

This is a HUGE red flag as any application, especially an ecommerce platform, should be focusing on obtaining new users.

Less MAU (monthly active users) = less chances for revenue. This has a rippling effect down the money line. IF they were to increase their revenue per user, they would need to increase the money made off users 50% (since their marketplace rev was down 32% YoY) while retaining 100% of spend users. For any ecommerce business, this is near-impossible to perfect and execute within a quarter, let alone a year.

[left]2. Competition - logistics and ecommerce[/left]

Oddly enough, one of Wish’s big money maker’s is their logistics department. As they used to be only a marketplace, they grew in their logistics revenue 126% year over year.

While this could be a bullish case for adding another revenue stream, there are a couple things to consider.

  1. There are more companies, primarily Uber and DASH, moving into the logistics space, with more users on their app already than WISH. This will limit/hinder WISH’s growth in logistics.
  2. WISH did not mention any headwind in their last report about supply chain issues. Considering a vast majority of their products come from China. We all know supply chain issues are completely fucked right now. With rising oil costs and delays in deliveries of goods, this should eat into their margins for logitiscs revenue.

Another point to consider is general ecommerce competition. I’m not talking about ecommerce marketplaces only, but large retailers that have ramped up their ecommerce efforts (Target, Walmart, even Dollar Fucking General). Taking a look here, WISH has dropped from top 10 to top 25 and is now out of the top 30. This drop has happened in a span of months.

So both in logistics as well as online marketplaces, WISH is continuing to lose market share.

3. User data/growth

One of the main things WISH is counting on for q3 is to retain the same amount of users and make ~50% more off of each user. While it’s easy to go find points of data showing they’re getting less traffic to the site for new users, a BofA report recently showed their DAU (Daily Active Users) is also decreasing at a significant rate.

This shows us they’re losing even more people every month that goes by, meaning they have to continually and try to make more money off their existing users, which again, is unlikely.

4. Leadership

This part of my bear case is purely skeptical and anecdotal, so if you’d like to skip it, please do.

I think the CEO is an absolute fuckhead.

I’ve personally met and hung out with Peter in a private setting (~20 people) and he had the makings of every single douchebag CEO in SF.

Every other word out of his mouth was “WISH is my passion, I love how it’s changing people’s lives” followed by “We’ve raised tens of millions of dollars”. He doesn’t fucking care about giving a student in latin america the ability to buy a notebook, he cares about his ego and how much money he has. He has a private instagram that is filled with a faux-Dan Bilzerian lifestyle. WISH is not his focus right now, living the .1% life is.

Worth noting, I think he’s smart in that he made an ok product, sold it well to investors, and cashed the FUCK out. If you look at insider trading history, he immediately sells every single stock option as soon as he receives it. This is in sharp contrast to other leaders at companies where they expect growth. When they exercise options, they either sell some or hold onto all of it. In Peter’s case, he immediately dumps it at market price. If the CEO of a company doesn’t want his own fucking stock, then who would?

Now for some tailwinds to consider

  1. Meme status - WISH is unfortunately a WSB favorite. It’s a meme stock. Like CLOV, SDC, and a few other tickers, people have no problem throwing 20-30k into it and “hodl-ing” even if it means burning free money. Taking a look at the WISH stock subreddit, it’s also clear there’s people who are convinced WISH is a $100 billion dollar company that’s undervalued. When entering a short/put position, you have to take into consideration people may see this as a buy the dip opportunity.

  2. Numerical Support - It’s always held pretty round nice numbers for support. If it “guhs” then it may quickly find support around $4 or $4.5. There is a high chance this becomes a slow bleed, not an immediate knife.

  3. Surprise acquisition - If I were a big company or an equity firm, I’d be licking my chops at acquiring WISH. I would not acquire WISH in continuing it as is. I would buy the company and strip it apart (users, shopping data, logistics, etc) and re-sell them for parts. Considering WISH’s downtrend, I can see this happening as an out for everyone involved in the company. If or when this happens I don’t know.

  4. Surprise buy back - This is another scenario that can happen on the earnings call. Who knows, maybe Peter actually does love the company and has had a change of heart. He could announce he’s buying back a ton of shares (which would make sense at this low price) in order to help those who have bought WISH stock and inject new life into the company.


All this said, I lean pretty bear on the stock.

Before Q3, WISH was bleeding new users and revenue was drilling. If companies like SNAP and FB were still citing iOS changes as problems for advertising, i don’t expect a company like WISH to have fared any better.

Their Q3 goal was to improve their product to extra more revenue per user, but looking at how many users they’re bleeding, it doesn’t seem likely they’re going to hit their revenue or user goals.

Their logistics leg was their one shining moment, but considering their main product source is China, that is unlikely to do as well in the future as it has done in the past.

In my opinion, they not only miss on their revenue, EPS, and user metrics, but also downgrade their future guidance.

There’s a lot more that point to bear but I think these things are the main things to look at. I welcome any discussion for bull cases so we can have the whole picture.



Great DD my guy. You mentioned it in passing but I wanna add some colour to one point - the iOS changes.

For those that don’t know, iOS 14 allows users to stop ads from tracking you. Most people do this. This fucks businesses like WISH. Most of their revenue came from ads, and with this new iOS change, targeting has gotten much worse. So their return on ad spend is like in the shitter. Compound this with the fact that last Q ER they said they were going to significantly reduce ad spend as well.

Disclaimer: I don’t have a position yet but will be looking for an entry this week. The biggest risk IMO is that it has bled so hard that the market might already be expecting an epic fail. A slightly less than epic fail might actually be bullish, who knows.


What a title I wonder you who came up with it!


What I’m seeing is that their overall engagement and search has been declining steadily. People have less interest in their website and that is pretty bad since they operate based on users engaging and buying things from their website.

Great DD Swole.


Adding to the bearish case.

Bibigo will replace Wish as the patch on Lakers jerseys this season and the company will also be involved with L.A. in other marketing campaigns and local community work.

A change like that for a global brand like the Lakers couldn’t have come cheap, and Bill Shaikin of the L.A. Times is reporting that Bibigo will be paying the organization $100 million over five years, which is the richest jersey patch deal in the NBA.


Adding a few things that I believe are bearish.

In an effort to improve delivery times, Wish created a “Wish Express” service.

Wish Express benefits include, but are not limited to:

  • Increased product impressions
  • Faster order payment eligibility
  • A unique orange truck badge highlighting your fast-shipping products in Wish app or
  • A dedicated “Express” section in Wish app or to surface Wish Express products

Looking into this service, it seems like a house of cards. The requirements to be approved for Wish Express are seemingly just indicating a 5 business day or less delivery time (region dependent - they use the example of France which is 6 days). The immediate issue that comes to my mind is that Wish are basically lying to customers by putting a faster delivery time on the listing without anything more than a pinky promise it’ll be delivered in the allotted time.

I imagine internally, this is causing them a lot of heartache from upset customers. If they’re policing repeated offenders that’s also just overhead for a merchant team. The kicker is that if you don’t manually specify a delivery period, it automatically gives the listing “Wish Express”. I don’t believe many $2 dildo merchants are going to expertly navigate what I feel is a pretty complicated merchant dashboard.

As shown below, eligibility for Wish Express depends on the max delivery days per product per destination .

Specifically, for an active product in the Primary and/or Secondary warehouse, if merchants set the “ max delivery days ” for any Wish-supported destinations as 5 or fewer business days (with the exception of the 12 countries listed in Merchant Policy 10.2; for example, merchants may set the max delivery days for France as 6 business days or fewer to be eligible for Wish Express) , related products will be considered Wish Express products and eligible for relevant benefits.

In addition, if merchants do not manually set the “max delivery days” per product per destination, Wish will default the delivery days shown to customers as 5 business days (with the exceptions for 12 destination countries listed in Merchant Policy 10.2; for example, the default delivery timeline will be 6 business days for France) , and the product will also be eligible to receive Wish Express benefits as well.


Additionally, Wish also has fulfillment services called “FBW” (Fulfillment by Wish) and “FBS” (Fulfillment by Store). Wish currently operates one fulfillment center in Ohio and another in Amsterdam. If the merchant chooses to do “FBW” they can further enhance this to “FBS” which promises their item’s availability in 30,000 partner stores. In doing a little research into their services, I found that they actually had two EU warehouses and closed one in July 2021 which I believe is a sign that their fulfillment services are a minor part of their business and haven’t been too successful. This was announced in January 2021 and may be “priced in”, but if it comes up in guidance it may serve as a bearish catalyst.



Adding to bearish case. WISH Insider Trading Activity | ContextLogic Insider Buys and Sells

“40.83% of ContextLogic’s shares are owned by company executives, directors and other insiders. Over the past twelve months, ContextLogic insiders have sold shares 50 time(s), totalling $164,479,127.26” quote from website. In Q2 of 2021 8.64M was sold by insiders and Q3 has a report of 9.25M.


Regarding the surprise buy back possibility - they have $1.2B cash (or equivalents) in the bank as of the end of last quarter, after losing $200M that quarter. They also have $890M in liabilities. If they announce a stock buy back being in such a shitty situation, I would imagine they would get loans called in or sued for whatever liabilities they owe and the stock would just die.


Great stuff here, bud. Honestly bewildered this ticker still exists. Upvote given.
If it touches 4.6 again, it should easily slip down from there.

I think they’re gambling for one last hurrah with this news getting pushed around since a few days ago…

That’s regarding their partnership with Klarna, aiming to get expanded to the US.

Might be a bloody Wednesday for some context against logic…


While some see this as bullish news, I see it as bearish, neutral at best.

KLARNA and AFFIRM work well in providing lower-middle class people a chance at luxury goods, through payment plans. WISH products are notoriously cheap (that’s what they built their whole model on) thus this kind of partnership is not suited to drive more revenue, or users.

I agree with your part that this is a last hurrah. It sounds very similar to PTON and TWTR announcing things right before their earnings to create some hype. Anyone that is logical with WISH price products can see this announcement is a planned shill, nothing else.

Thank you for sharing.

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Really appreciate the research!

Adding to the bear case is one thing that Wish likely hadn’t foreseen: SHEIN

Check out these app download figures for October:

SHEIN has absolutely exploded over the last few months and with it, it’s probably taken a decent chunk out of Wish’s clothing sales / customer base. Weighing in at 14M app downloads between both stores last month, SHEIN outperformed Wish and AliExpress combined.

Then of course there’s AliExpress which has been largely responsible for Wish’s demise which has close to 3x the downloads last month that Wish had.

Given everything I think Wish likely not only didn’t gain customers this quarter, they probably lost customers and what customers they did manage to keep are likely only buying some of what they used to buy from Wish in favor of buying from more specialized retailers like SHEIN.

Wish would’ve needed a miracle here…. And it’s not looking like they got one.


I’ve come to give strike price analysis, I do not want you to take this as me telling you exactly what to buy but because of how cheap these puts are you could easily lose the entire position if this play doesn’t go our way.

I highly recommend you don’t buy now, I think wish probably drops until earnings but if it stays flat or near the current price then theta will bash your head into a wall.

An example of a 4 strike puts value on Wednesday if the price stays about flat

So yeah don’t buy now unless you think wish is just gonna drop like 15% in the next two days. (Very likely won’t)

Earnings are the 10th after hours btw if you didn’t realize it yet.

And once again remember we are dealing with contracts that cost pennies and are as close to worthless as it gets and can easily become worthless which means the entire position goes poof.


This. If this was a ten dollar stock it was puts all the way. This and ATER both, however the price is so cheap now

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It can still go down to being a penny stock and back to the OTC markets!


This exactly my advice if you are going to play this stock is to buy the day of earnings


I agree with this, but that chart does not factor in the IV increase as we approach earnings, right?

I too think the company is full of crock of shit.
I believe I’m the most bearish of our channel. I’ll be looking for good entry tomorrow and go full grizzly bear.

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It does not but even with an IV increase they likely still decrease in value and with the run it had today they dipped. If you want to buy Nov 19s it’s probably fine to buy in tomorrow but for 12s keep waiting


I want to echo NoSauceNoGain’s take on WISH puts since he does not think its a good play to buy puts. He mainly says that WISH is already expected to do shit on their ER and if they barely beat it, the calls will print. Essentially, there is more upside than downside for wish. He believes 4p lotto is ok, but 2p or 3p is bad.

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The People that bought puts on Monday are now in the green, even with the theta decay and WISH climbing. I guess the IV climb outweighed the price rise and theta decay?

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