Wayfair to layoff 5% of its workforce, or nearly 900 employees – TechCrunch
Wayfair, the online home goods retailer, announced today it was laying off close to 900 employees as a way to reprioritize investment needs and meet the company’s current needs. This comes after the company announced a hiring freeze back in May.
The layoffs represent close to 5% of the company’s global workforce and 10% of its corporate team, according to SEC filings. 400 jobs are being cut in Boston, at the company’s HQ.
“We were seeing the tailwinds of the pandemic accelerate the adoption of e-commerce shopping, and I personally pushed hard to hire a strong team to support that growth,” said Founder and CEO Niraj Shah in the company’s memo to employees. “This year, that growth has not materialized as we had anticipated. Our team is too large for the environment we are now in, and unfortunately, we need to adjust.”
It is unclear which teams were specifically affected by the layoffs. TechCrunch reached out to Wayfair but was referred to the company’s memo.
Those laid-off will receive a severance package based on geography and tenure. According to the company, U.S.-based employees will receive a minimum of 10 paid weeks in addition to other resources — outplacement services for example.
The Boston-based company said it is expecting layoff costs to range between $30-$40 million, comprised mainly of employee severance. According to the SEC filing, the hit will be reflected in the company’s current quarter.
“We are actively navigating Wayfair towards a level of profitability that will allow us to control our own destiny, while still investing aggressively in the future,” Shah said. “We’ve prioritized our work and set clear goals: to focus on the basics, drive cost efficiency and earn more customer and supplier loyalty. This macro environment doesn’t change our belief in the size of the opportunity ahead, and we are moving purposefully to seize that opportunity.”
For the first two years of the COVID-19 pandemic, the company was profitable and reflected so in its stock, but has since taken a hit. According to The Wall Street Journal, Wayfair’s stock fell by over 17% Friday morning.