Bed Bath & Beyond’s woes continue to mount after the big-box retailer reported a substantial Q3 2023 loss of $393 million and a major drop in comparable sales. The report follows recent warnings by the retailer over a potential bankruptcy as it struggles to secure enough cash to stay afloat.
Bed Bath’s Net Sales Plummet 33% as Inflation Forces Consumers to Switch Buying Habits
Bed Bath & Beyond Inc has reported a significant loss of $393 million for its fiscal Q3 2023 following a difficult holiday season that the company had hoped would provide a much-needed financial boost to its prolonged cash burn. The move comes just days after the retailer warned investors that it expects a major loss in Q3 and hinted at a potential bankruptcy. Bed Bath’s shares rose more than 6% in premarket trading despite a disappointing quarterly report.
To cut costs, Bed Bath & Beyond said it had implemented reductions of $80 to $100 million across its corporate operations, including overhead expenses and headcount. Additionally, the company said its net sales had declined 33% to $1.26 billion in Q3, as consumers continue to deal with harsh inflationary pressures and turn their attention to products other than home goods, furniture, and decor, which represent a crucial part of Bed Bath’s inventory.
Earlier reports have indicated that the merchandise retailer is also considering skipping debt payments due on February 1st to preserve cash ahead of a potential bankruptcy filing. The company said it was exploring other options to remain afloat, such as restructuring, raising new capital, and selling some of its assets. Bed Bath raised $375 million in August 2022 but failed to win bondholders’ trust to exchange their investments for fresh debt earlier this month.
BBBY Market Cap Down at $142.8M amid Stronger Headwinds
Bed Bath’s Q3 report missed expectations across the board. The company reported $1.26 million in revenue, short of consensus estimates of $1.34 billion.
In addition, the reported $393 quarterly loss marked a notable increase from a $276 million loss reported in the same period last year. Further, the retailer’s comparable sales declined by 32% in the three-month period, driven by significant sales slumps at its namesake banner Bed Bath & Beyond and Buybuy Baby.
The financial results report marks another blow and a sharp U-turn for the big-box retailer, which has seen unprecedented growth during the meme-stock craze in 2021. But just like the majority of other meme stocks, BBBY has lost most of its gains since then, with its market cap plummeting to $142.8 million.
The stock received a boost last year when GameStop chairman Ryan Cohen revealed a major stake in Bed Bath, but those gains were quickly eradicated after Cohen undid the move and sold his entire stake in the retailer.
This article originally appeared on The Tokenist
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