Topline
Bed Bath & Beyond’s stock fell 28.7% to $8.64 in premarket trading Wednesday after the struggling home retailer unveiled several initiatives to turn around the business, as the rollercoaster ride for the one-time meme stock darling continues.
A Bed Bath & Beyond sign hangs outside the store on June 29 in Miami.
Key Facts
Bed Bath & Beyond announced several cost-cutting measures, closing about 150 brick-and-mortar locations and laying off about 20% of corporate and supply chain employees.
In a separate Securities and Exchange Commission filing Wednesday, the company said it “may offer, issue and sell shares of our common stock,” the news that contributed to the stock’s decline.
Bed Bath & Beyond also said Wednesday it secured more than $500 million in new financing, including $375 million from Sixth Street Partners, a much-needed deal to address the company’s massive debt load.
Key Background
A favorite of retail investors since early last year, Bed Bath & Beyond shares have recently cratered alongside other meme stock darlings, falling roughly two-thirds from its January 2021 high. The company’s stock has rallied this month thanks largely to popularity on the WallStreetBets Reddit forum, rising 300% to $23.08 from August 1 to August 17. Shares of Bed Bath & Beyond fell more than 40% August 18 after billionaire investor Ryan Cohen sold his 10% stake in the retailer, though they rose about 15% last Wednesday after the Wall Street Journal reported on the new financing that Sixth Street Partners is funding.
Tangent
Dozens of other major companies have also announced layoffs this summer amid recession fears. Snapchat parent Snap plans to cut about a fifth of its workforce, the Verge reported Tuesday.
Further Reading
Bed Bath & Beyond Falls Over 40% After Investor Ryan Cohen Sells His Entire Stake (Forbes)
Source: https://www.forbes.com/sites/dereksaul/2022/08/31/bed-bath–beyond-tanks-nearly-30-as-it-announces-layoffs-and-store-closures/