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Bed Bath and Beyond closes more than 200 stores after sales fell 50% during COVID-19

Bed Bath and Beyond will permanently close 200 of the home store giant’s brick-and-mortar stores after the chain’s first quarter sales fell 50 percent when the corona virus outbreak occurred.

The retailer announced closings on the same day Wednesday, reporting that online sales rose 100 percent in April and May.

The spike was attributed to customers rushing to buy cleaning products and household items during the pandemic. Online sales represented approximately two-thirds of the total for the first quarter.

Bed Bath and Beyond will permanently close 200 of the home store giant's brick-and-mortar stores after the chain's first quarter sales fell 50 percent when the corona virus outbreak occurred.  Last month, one of the chain's newest stores in New York City was pictured

Bed Bath and Beyond will permanently close 200 of the home store giant’s brick-and-mortar stores after the chain’s first quarter sales fell 50 percent when the corona virus outbreak occurred. Last month, one of the chain’s newest stores in New York City was pictured

A manager at a Bed Bath and Beyond in Los Angeles packs cooking clothes for a client.  Despite sharply declining sales in brick-and-mortar stores in the first quarter, retail online sales rose 100 percent in April and May

A manager at a Bed Bath and Beyond in Los Angeles packs cooking clothes for a client.  Despite sharply declining sales in brick-and-mortar stores in the first quarter, retail online sales rose 100 percent in April and May

A manager at a Bed Bath and Beyond in Los Angeles packs cooking clothes for a client. Despite sharply declining sales in brick-and-mortar stores in the first quarter, retail online sales rose 100 percent in April and May

The stores to close will close over the next two years and are expected to save the chain between $ 250 million and $ 350 million. CNBC reports.

Bed Bath and Beyond has nearly 1,500 stores, including 955 operating under the chain’s brand name. The company also operates BuyBuy Baby, Christmas Tree Shops and Harmon Face Values.

Shares in the company fell by more than 6 percent in out-of-hours trading after the announcement.

In the first quarter, the chain said it had revenues of $ 1.31 billion and a net loss of $ 302.29 million, or $ 2.44 per share. That was down $ 371.09 million, or $ 2.91 per share, in the year-ago period.

The company said it lost $ 1.96 per share, excluding one-off items.

Mark Tritton, CEO of Bed Bath and Beyond, told CNBC in a telephone interview that a number of stores were “dragging down” the chain.

Despite the positive news about digital sales, gross margins still declined by about 8 percentage points as a result of more expensive execution and shipping costs.

Shares in the company fell more than 6 percent in out-of-hours trading after the retailer's announcement on Wednesday

Shares in the company fell more than 6 percent in out-of-hours trading after the retailer's announcement on Wednesday

Shares in the company fell more than 6 percent in out-of-hours trading after the retailer’s announcement on Wednesday

Bed Bath and Beyond has nearly 1,500 stores, including 955 operating under the chain's brand name.  The company also operates BuyBuy Baby, Christmas Tree Shops and Harmon Face Values

Bed Bath and Beyond has nearly 1,500 stores, including 955 operating under the chain's brand name.  The company also operates BuyBuy Baby, Christmas Tree Shops and Harmon Face Values

Bed Bath and Beyond has nearly 1,500 stores, including 955 operating under the chain’s brand name. The company also operates BuyBuy Baby, Christmas Tree Shops and Harmon Face Values

The pandemic has had a devastating impact on retail in the United States as other chains reported similar losses during their first quarter as a result of COVID-19.

The lack of sales has prompted retailers to tap credit lines, fire workers, and suspend dividends and refunds to keep their heads above water.

Macy’s last week released final results for the fiscal first quarter ending May 2, demonstrating how state-imposed shutdowns to curb the spread of the outbreak have taken a big financial toll on the retailer.

Macy's last week released final results for the fiscal first quarter ending May 2, demonstrating how state-imposed shutdowns to curb the spread of the outbreak have taken a big financial toll on the retailer.  A man with a mask walks near Macy's flagship store in New York City

Macy's last week released final results for the fiscal first quarter ending May 2, demonstrating how state-imposed shutdowns to curb the spread of the outbreak have taken a big financial toll on the retailer.  A man with a mask walks near Macy's flagship store in New York City

Macy’s last week released final results for the fiscal first quarter ending May 2, demonstrating how state-imposed shutdowns to curb the spread of the outbreak have taken a big financial toll on the retailer. A man with a mask walks near Macy’s flagship store in New York City

Macy’s reported a massive loss of $ 3.58 billion, or $ 11.53 per share, compared to a profit of $ 136 million, or 44 cents per share, compared to the same period a year ago.

Macy’s, which also owns Bloomingdale’s, said net sales for the first quarter through May 2 were nearly halved to $ 3.02 billion.

The retailer’s results are due to the fact that some of its industry peers, including J Crew, JCPenney and Neiman Marcus, filed for bankruptcy for not being able to handle the market uncertainties and rising debt.

Moody’s listed Nieman Marcus among the nine stores that might struggle to repay their debt, as the pandemic pushes retailers to the limit.

J. Crew, which employed approximately 13,000 people on an April leave program, was the first high-profile retailer to seek bankruptcy protection since the coronavirus. Neiman Marcus followed suit and filed for bankruptcy protection on Thursday, marking one of the most notable collapses to date.

Moody’s then named the stores under nine, including pharmacy giant Rite Aid and pet supplier Petco, who held most of the distressed retail debt. Others include Party City, Academy Ltd, Belk and Ascena Retail Group.

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