Online furniture retailer Wayfair said it will cut 1750 jobs, or 10 per cent of its workforce, in a cost-saving drive at a time when persistently high inflation has pressured consumer spending.
The news sent its shares as much as 26 per cent higher to an over four-month high of $48.94 amid broader market gains.
The Boston-based retailer joins a growing list of US companies – from tech giants such as Alphabet Inc and Microsoft Corp to home goods retailer Bed Bath & Beyond – that have slashed their workforce and reined in spending to ride out the economic downturn.
On Friday, Wayfair said the job cuts will affect 18 per cent of its corporate workforce, or about 1200 employees. The company said in August it will cut 870 jobs.
It had previously outlined a $1.4 billion cost-saving plan to scale down on operating costs amid weakening demand for its furnishings. Including the August workforce reduction, the company said on Friday the labor portion of the plan represents about $750 million in savings.
“It’s a move in the right direction to realign the company’s cost structure for today’s environment,” said senior analyst Anna Andreeva from Needham & Co, adding that Wayfair is becoming more flexible and agile.
The Wall Street Journal first reported the layoffs on Thursday.
Wayfair had 16,681 full-time equivalent employees as of December 31, 2021, according to a regulatory filing.
- Reporting by Granth Vanaik in Bengaluru; Editing by Savio D’Souza, Shinjini Ganguli and Devika Syamnath, of Reuters.
