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Wayfair's stock has collapsed 75% year-to-date

·Senior Reporter
·2 min read
In this article:
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Wayfair's (W) stock is getting pummeled. Amid the tech crash, the e-commerce company for furniture and home goods has taken an especially hard hit, with shares down about 75% in 2022 so far.

Snap (SNAP), Netflix (NFLX), and Shopify (SHOP) have also seen jarring declines amid inflation, the war in Ukraine, rising gas prices, and escalating interest rates. As macroeconomic conditions have deteriorated, the pandemic e-commerce boom has also slowed while concerns about consumer spending have grown. These troubles have been reflected back in Wayfair's earnings. For example, in Q1 2022, Wayfair's revenue dropped 13.9% year-over-year as its customer base simultaneously decreased 23.4%.

The decline in the company's customer base is concerning, as Wayfair has a history of needing to spend big on advertising to acquire customers; concerns about that strategy date back to its 2014 IPO.

Wayfair sells a wide range of furniture, decor, and other home goods, all particularly popular categories for consumers during the pandemic, as they spent more and more time at home. Bed Bath & Beyond (BBBY) similarly saw a shelter-in-place-facilitated boom.

Wayfair's logo. (Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images)
Wayfair's logo. (Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images)

On top of the year-to-date decline, in the last 12 months, shares of Wayfair have fallen 84.02% as of market open on Tuesday. It's a stark drop, since in March 2021, the company's stock hit more than $340 a share. On Tuesday at the close of the market, Wayfair's shares were trading for $47.14 a pop.

Wayfair's future remains unclear

Boston-based Wayfair's future is uncertain. The company's risks — both now and long-term — include "competition [and] lack of profitability," Baird analyst Colin Sebastian wrote earlier this month. Still, Sebastian has remained neutral on the stock for now, and cites a $70 price target.

Wayfair's stock market decline has corresponded with a hiring freeze that commenced in mid-May. There's also been reshuffling at the very top of the company. Wayfair CFO Michael Fleisher — who's been at the company for eight years — is planning to step down, and will be replaced by Kate Gulliver, who's also been at the company for about eight years. As she takes on the CFO role, Gulliver will also become Wayfair's Chief Administrative Officer.

The company is reportedly set to open its first brick-and-mortar stores this year.

Allie Garfinkle is a senior tech reporter at Yahoo Finance. Find her on twitter @agarfinks.

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