Online home goods retailer Wayfair is laying off about 900 employees worldwide, which is 5% of the company’s workforce, the company said in a memo to employees on Friday. The company said the cuts include about 400 jobs in Boston, where Wayfair is headquartered.
Wayfair saw a surge in business during the pandemic, as people avoided brick-and-mortar shopping at home and increased spending on furniture, home renovations and other home improvements. But the economic climate has turned against the company, as inflation narrowed the household budget and limited non-essential purchases.
Neeraj Shah, Founder and CEO of Wayfair, said in the memo, “We were seeing an uptick in the adoption of e-commerce shopping due to the pandemic, and I personally hired a strong team to support that growth. Worked hard to hire.” “This year, the growth hasn’t been as we anticipated.”
Wayfair said laid-off employees will receive a severance based on geography, tenure and level. The company is offering US-based employees a minimum of 10 weeks’ pay, as well as continued vesting of existing equity through October, the company said.
Wayfair instituted a hiring freeze in May, signaling that its near-term outlook has changed. In total, the company has 18,000 employees.
The company’s stock fell more than 10 percent in early trading on Friday morning.
“We are actively driving Wayfair towards a level of profitability that will allow us to take control of our fortunes while investing aggressively in the future,” said Shah, Wayfair CEO.
“This macro environment does not change our belief in the size of the opportunity ahead, and we are moving forward with the aim of seizing that opportunity,” he said.