Check out the latest Wayfair earnings call transcript.
The drop still left shareholders in positive territory for the year, however: The stock gained 12% in 2018 while the broader market fell 6%.
Wayfair's December decline can't be pinned on weakening operating results. In fact, its last public update contained plenty of good news for investors. Wayfair said in late November that sales growth sped up during the peak shopping period between Thanksgiving and Cyber Monday, and that the e-commerce company had experienced record demand for its home furnishings.
Still, given the stock's impressive run-up through the second and third quarters of 2018, even that bright growth outlook wasn't enough to protect shares from the drubbing that has sapped significant value from many of the market's biggest recent winners.
A lot is riding on Wayfair's upcoming Q4 results, which will detail just how much market share the company was able to win during the holiday shopping season. Yet it's at least as important that the report show healthy advertising and marketing expenses, which will help investors feel confident in its long-term earnings prospects. That's the surest path toward continued stock price gains, even as Wayfair posts its fifth consecutive annual loss.