Shares of Wayfair Inc.
W,
shot up 12.2% toward a four-month high in morning trading Friday, after the online home furnishings seller said it was laying off 1,750 employees, or 10% of its workforce, as part of a cost-cutting plan. The announcement came after The Wall Street Journal reported late Thursday that the company was preparing to lay off more than 1,000 workers. The company said the jobs cuts will include 1,200, or 18%, of corporate employees, as it looks to eliminate management layers. Wayfair expects to record charges of $68 million to $78 million, mostly in the first quarter, for severance and benefit costs. The company expects to save $750 million a year from the job cuts, including cash and stock-based compensation, while the total cost-cutting plan looks to cut $1.4 billion in costs a year. The stock, which dropped 10.0% amid a three-day losing streak through Thursday, has now run up 35.8% over the past three months while the S&P 500
SPX,
has gained 6.7%.
