Online furniture retailer Wayfair has announced the reduction of approximately 1650 employees, representing 13 per cent of its global workforce and 19 per cent of its corporate team.

The move, which the company calls a ‘workforce realignment plan’, is part of a range of actions aimed at “right-sizing its cost structure”. The job cuts are expected to deliver annualized cost savings of more than $280 million.

“The changes announced today reflect a return to our core principles on resource allocation, such as getting fit on spans and layers as well as focusing on our highest priorities,” commented Niraj Shah, CEO, co-founder and co-chairman at Wayfair.

“As a result, we’re reducing team sizes across the organization, as well as reducing seniority in certain roles that we plan to rebuild with modified levelling over the course of this year.”

The company said the incremental cost savings will provide it further confidence in the path to deliver substantial growth in 2024. The firm expects to deliver over $600 million of Adjusted EBITDA this year.

“Although persistent category weakness makes revenue growth challenging, we remain encouraged by the share gains we continue to see,” added Shah.

Following the workforce reduction, Wayfair will incur $70-80 million in costs, consisting primarily of employee severance and benefit costs.

The Boston-based company previously reported $12 billion in net revenue for the 12 months ended September 30.