(Updated to add more details in the fifth and sixth paragraph, and the recent stock move in the last paragraph.)
Wayfair (W) said Friday it is exiting the German market immediately, a move expected to impact about 730 employees and result in restructuring charges of $102 million to $111 million.
The company plans to reassign about half of the affected roles to other corporate offices, according to a regulatory filing with the US Securities and Exchange Commission.
Estimated costs include $40 million to $44 million in cash expenses for severance, benefits, relocation, and transition, with $62 million to $67 million in non-cash charges for facility closures and related wind-down activities, the company said.
"Despite these efforts, scaling our market share and improving our unit economics in the German market has proven challenging due to factors such as the weak macroeconomic conditions for our category in Germany, the lower maturity of our offering, our current brand awareness, and our limited scale," Chief Executive Officer Niraj Shah said in an email to employees.
Wayfair said most cash payments are expected within the next year, with non-cash charges anticipated in fiscal Q4 2024 and Q1 2025.
The company plans to use the savings from the restructuring for reinvestment in core initiatives and operations in Canada, the United Kingdom, and Ireland throughout 2025, Wayfair added.
Shares of the company were down 2% in recent Friday premarket activity.
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