Wayfair Inc. shares skyrocketed 24.57% during Tuesday's intraday session after the online home furnishings retailer reported second-quarter results that handily beat Wall Street estimates, with the rally further amplified by a short squeeze amid exceptionally high bearish positioning in the stock.

The company posted adjusted earnings of $0.95 per share, topping the consensus estimate of $0.90, while revenue rose 7.5% year-over-year to $3.52 billion, exceeding the Street's forecast of $3.47 billion. U.S. net revenue surged 8.7% to $3.1 billion, marking the strongest post-COVID second-quarter growth rate as order volumes and active customers both climbed. Adjusted EBITDA reached $242 million, and free cash flow hit $301 million — the highest since 2020. CEO Niraj Shah highlighted that the company delivered its best sequential second-quarter growth since 2020, driven by market share gains and accelerating momentum in specialty and premium brands such as Perigold, which saw sales jump over 35%.

The magnitude of the stock's surge was likely magnified by a short squeeze. With approximately 18% of Wayfair's public float sold short — representing 14.75 million shares — the strong earnings provided a catalyst that forced bearish traders to cover positions, adding rocket fuel to the rally.