BOSTON – Wayfair is cutting 870 employees, which represents 5% of the company’s global workforce along with 10% of its corporate team. The company filed a Form 8-K with the U.S. Securities and Exchange Commission today.
The cuts come amidst the company’s previously announced plans to manage operating expenses and realign investment priorities. In the 8-K filing, Wayfair said its currently in the process of making substantial reductions to it’s third-party labor costs.
“As a result of this workforce reduction, we expect to incur between approximately $30 million and $40 million of costs, consisting primarily of employee severance and benefit costs, substantially all of which we expect to incur in the third quarter of 2022,” the company said in the filed statement.
Earlier this month, Wayfair posted second quarter total net revenue of $3.3 billion, which is down 14.9% from the second quarter of 2021. The stock has fallen 44.3% over the past six months.
“During a difficult macroeconomic environment, we remain squarely focused on our customers and our suppliers, and on making sure Wayfair is their preferred platform for the home,” said Niraj Shah, CEO co-founder, and co-chairman, Wayfair in the second quarter earnings report earlier this month. “We are tightly controlling our many levers and steering Wayfair in a financially responsible manner through this period.”
On the second quarter earnings call with investors, Shah said that Wayfair has articulated a clear set of goals to the entire organization, which include three key tenets: drive cost efficiency, deliver best-in-class execution by nailing the basics, and earn customer and supplier loyalty every day.