Erstwhile meme stock Bed Bath & Beyond warned Thursday of potential bankruptcy. BBBY stock crumbled to its lowest level in nearly 30 years.
The home goods retailer pointed to a sharp drop in its fiscal third-quarter results, expecting net sales of approximately $1.29 billion. It cited "lower customer traffic and reduced levels of inventory availability." It projects net losses will accelerate to $385.8 million, vs. a $276.4 loss a hear ago.
Analysts surveyed by FactSet estimated sales at $1.41 billion, with per share losses steepening from 25 cents a year ago to $1.91.
A statement from President and CEO Sue Gove said the company had strengthened its management team at the start of the quarter in order to execute the restructuring effort. The plan has two anchors, Gove said. The first aims to refocus merchandising and inventory, operate more efficiently, and grow the company's digital capabilities. The second focuses on strengthening its financial position.
"Transforming an organization of our size and scale requires time, and we anticipate that each coming quarter will build on our progress," Gove said.
Meme Stocks Under Pressure
BBBY stock had attracted added attention during the early pandemic years, as web-based retail investors drove steep gains, lending the issue "meme stock" status. Bed Bath & Beyond shares rallied as much as 1,180% from March 2020 to January 2021.
The stock then fell about 18% in 2021, before tumbling nearly 83% last year. Shares on Thursday sank nearly 30% to below 2. BBBY stock is trading at levels not seen since 1993.
Other meme stocks were also under early pressure: Game Stop skidded 6.4% lower. AMC Entertainment fell 3.2%.
