Bed Bath & Beyond Plans New Store Closures, Layoffs As It Burns Through Cash
CEO Sue Gove told analysts this week she was pursuing $80M to $100M in cost reductions across the company, including additional store closures and layoffs, The Wall Street Journal reported.
The cuts come after Bed Bath & Beyond burned through roughly $300M in cash in the fourth quarter, just months after receiving a $500M cash infusion.
The retailer is continuing the store closure campaign that it announced in August, adding 34 more stores to the list, Yahoo Finance reported. The closures include at least 16 stores in California, eight in New York, seven in New Jersey and three in Connecticut.
Bed Bath & Beyond's fourth-quarter earnings, released Tuesday, show the retailer suffered an adjusted operating loss of $225M for the quarter. Sales were down 33% compared to the same time period last year, and the retailer has just over $153M in cash on hand.
Those numbers are largely in line with expectations the retailer itself set last week in a notice to the Securities and Exchange Commission that it would be late in submitting its quarterly earnings report.
Given its current financial situation, some experts believe a bankruptcy filing is just weeks away, according to the WSJ. That could put hundreds of additional stores at risk, as Bed Bath & Beyond leased 27.9M SF of retail space across its 953 stores as of July.
Despite its poor financial performance, Bed Bath & Beyond’s stock price spiked 50% Wednesday morning amid a rally of “meme stocks,” including Gamestop and AMC Entertainment, CNBC reported.
The new financials follow a year of tumult for Bed Bath & Beyond, which has seen a shake-up from top to bottom. Gove took over as CEO first on an interim basis in June and then permanently in October, following the exit of former CEO Mark Tritton.
Chief Accounting Officer Laura Crossen also took over as the retailer's interim chief financial officer after the death of former CFO Gustavo Arnal in September.