The online retailer of home products Wayfair stated today that it would be laying off close to 900 staff members in order to reprioritize its investment requirements and address urgent business demands. This follows the company’s May announcement of a hiring freeze.
According to SEC filings, the layoffs affect about 5% of the company’s global workforce and 10% of its corporate staff, with 400 jobs lost at the company’s headquarters in Boston.
In the company’s email to staff, founder and CEO Niraj Shah stated, “We were seeing the tailwinds of the epidemic accelerate the adoption of e-commerce shopping, and I personally pushed hard to hire a great team to support that development.” “That growth has not occurred this year as expected, unfortunately. Unfortunately, we have to make adjustments because our team is too big for the situation we are in right now.
Which teams directly suffered from the layoffs is unknown. When TechCrunch contacted Wayfair, the company’s memo was given as the response.
A severance payout depending on geography and tenure will be given to those who are fired. In addition to additional resources, such as outplacement assistance, U.S.-based employees will receive a minimum of 10 paid weeks, the business claims.
The Boston-based corporation stated that it anticipates employee severance to make up the majority of the $30–$40 million in layoff costs. The hit will be recorded in the company’s current quarter, per the SEC filing.
While continuing to make aggressive investments in the future, Shah stated, “We are actively leading Wayfair towards a level of profitability that will allow us to dictate our own destiny.” “We’ve prioritized our work and established clear objectives: to concentrate on the fundamentals, promote cost efficiency, and increase supplier and customer loyalty. We continue to firmly believe in the enormity of the opportunity that lies ahead, and we are taking deliberate steps to take advantage of that opportunity, despite the macroenvironment.
The company was lucrative for the first two years of the COVID-19 pandemic, and this was reflected in its stock, but it has subsequently suffered. The Wall Street Journal reports that Wayfair’s stock dropped more than 17% on Friday morning.