Online retailer Wayfair saw its stock price plummet on Thursday amid a market rout, particularly among e-commerce companies.
Shares of the Boston-based company declined 26 percent to close at $67.45 after it announced first-quarter results that didn’t meet analysts’ expectations. The shares have lost 74 percent over the past six months.
The sharp plunge came amid a broader market slide for most tech stocks. Boston cybersecurity company Rapid7 lost 17 percent, as its earnings report also disappointed analysts, while software firm HubSpot dropped 13 percent and DraftKings lost 8 percent.
Wayfair was among the biggest beneficiaries of changing consumer behavior during pandemic lockdowns, as more people shopped online and spent more money on home goods. But since lockdowns have eased, sales at Wayfair and other online sellers including Etsy, eBay, and Amazon have tailed off.
In the first quarter, Wayfair’s sales totaled $3 billion, 14 percent less than the same period a year ago. The company posted a net loss of $319 million, or $3.04 per share. A year earlier, Wayfair had a profit of $18 million, or 18 cents a share.
Analysts were concerned that Wayfair does not appear to be retaining all of the customers that it attracted — at great cost — during the lockdowns. With 25.4 million active customers at the end of March, Wayfair shed about one-quarter of its customer base from a year earlier.
Wayfair doesn’t manufacture any of the furniture it sells and its suppliers have been suffering long delays, analyst Kenneth Leon at CFRA Research noted. “Prospective buyers and customers are frustrated at not being able to get merchandise in time or at all on [Wayfair’s] platform,” Leon said.
Chief executive and cofounder Niraj Shah attempted to calm investors about the company’s mounting losses in a statement accompanying the results.
“We have complete confidence in the structural economics of our business based on the investments we have made and the key drivers that should propel profitability higher over time,” Shah said.
Shares of rival online retailers also plunged on Thursday. Etsy’s stock price dropped 17 percent, eBay was down 11 percent, and Amazon lost 8 percent.
Wayfair also announced on Thursday that chief financial officer Michael Fleisher plans to retire. Current chief people officer Kate Gulliver will take over the role starting in November.