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Shares of Bed Bath & Beyond plunged on Wednesday after the retailer and short-lived meme stock favorite unveiled its plan to improve its finances.
The company’s stock plunged 24% in early trading, falling to $9.17 per share as of 10:08 a.m. ET. That’s more than a 50% drop over the past two weeks, though the company continues to trade well above its $5.77 price at the start of the month.
The stock, which has seen its share of volatility in the meme stock world, has already been rocked this month after Chewy founder Ryan Cohen sold his 11.8% stake in the company just months after buying in, despite indicating he was in it for the long term.
Traders on Reddit’s r/WallStreetBets forum were hit especially hard, with one saying they had realized a $1.1 million net loss with their investment.
Wednesday’s drop is more fundamentals based, however. Bed Bath & Beyond said it had secured more than $500 million in new financing and planned to close 150 “lower producing” stores and cut its workforce by 20%. The company also plans to bring back popular national brands it previously did away with to bring back customers, while dropping nine private labels.
The company, which is already looking for a new CEO and chief marketing officer, also announced its chief operating officer was leaving and the role was being eliminated.
“We are embracing a straight-forward, back-to-basics philosophy that focuses on better serving our customers, driving growth, and delivering business returns,” said interim CEO Sue Grove. “In a short period of time, we have made significant changes and instituted enablers across our entire enterprise to regain our dominance as a preferred shopping destination.”
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