Bed Bath and Beyond Reports $393M Loss in Q3 2022, Net Sales Down 33%

Bed Bath & Beyond’s woes continue to mount after the big-box retailer reported a substantial Q3 2022 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 2022 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.

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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.

Do you think Bed Bath & Beyond will still avoid bankruptcy despite the latest loss? Let us know in the comments below.