This Wayfair Analyst Cuts Forecast After Workforce Reduction Announcement

Shares of Wayfair Inc W were declining after the company announced a planned technology workforce reduction.

The company's technology replatforming led to the decision to close the Austin Tech Center and reduce its workforce, according to JPMorgan.

The Wayfair Analyst: Analyst Christopher Horvers reaffirmed an Overweight rating, while lifting the price target from $63 to $50.

The Wayfair Thesis: The company expects the re-platforming to help consolidate teams and devote resources to other parts of the business. Resources will likely be relocated to activities that drive growth, Horvers said in the note.

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Wayfair's current decision is "very different" from prior workforce reductions that were either "designed to narrow its growth bets" or resulted from the closure of a business that was not yielding expected returns, he stated.

The company expects to incur one-time costs of between $33 million to $38 million in severance and transition expenses. Most of the costs will take place over the next 12 months, the analyst stated. These costs may offset short-term cost savings specifically guiding annual cost savings, he added.

"W expects to realize savings from the reorganization in 2H25 and early 2026 on top of what they plan to reinvest in the business," Horvers further wrote.

W Price Action: Shares of Wayfair had declined by 3.46% to $33.80 at the time of publication on Monday.

The company first went public in October 2014.

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