Wayfair to Lay Off Nearly 900 Workers

Shares fell more than 10% in Friday trading. The stock has lost about two-thirds of its value this year.

The Boston-based furniture and home-goods company said it expects the layoffs to cost between $30 million and $40 million, consisting largely of employee severance and benefits. These costs are expected to be reflected in the company’s current quarter, it said.

Wayfair’s layoff announcement comes two weeks after it reported its fourth consecutive quarter of losses. The company was profitable for a brief period in 2020 and 2021, fueled by shoppers sprucing up the homes they were relegated to during the early months of the coronavirus pandemic. Before the pandemic, Wayfair in early 2020 laid off about 500 workers as it grappled with losses.

Wayfair is among several online retailers that enjoyed rapid growth during the health crisis and are now struggling as consumers have returned to shopping in stores, and high inflation leads price-conscious customers to hold off on discretionary purchases. Wayfair’s number of active customers—those who placed an order within the past 12 months—was down 24% to 23.6 million in the second quarter.

Many retailers are coping with shifts in consumer spending by cutting prices and running more sales, which led to online prices dropping for the first time in over two years in July, according to data from Adobe Analytics.

They are also cutting jobs. Online secondhand marketplace

ThredUp

said Monday it was laying off 15% of its corporate workforce and closing one of its processing centers, after reporting that its losses had widened during the previous quarter. Other companies including

Shopify Inc.,

Warby Parker Inc.,

and

Stitch Fix Inc.

have reduced their head counts this year.

Wayfair said it is making substantial reductions in its third-party labor costs.

Write to Charity L. Scott at Charity.Scott@wsj.com and Connor Hart at connor.hart@wsj.com