Shares of Bed Bath & Beyond (NASDAQ:BBBY) fell as much as 7% early Monday, then settled to trade down 4.8% after the specialty retailer announced the resignation of its chief executive officer.
In a press release this morning, Bed Bath & Beyond said CEO Steven Temares has also resigned as a member of the company's board of directors, effective immediately.
The move shouldn't be entirely surprising. Bed Bath & Beyond has faced increasing pressure from multiple activist investors calling for a complete executive overhaul in recent months, with one group insisting last month that "only the complete replacement of the Board and CEO will be sufficient to drive the necessary changes to produce lasting margin improvements and growth in earnings."
At the same time, Bed Bath & Beyond only just announced sweeping board changes a few week ago, through which five independent directors were replaced and two co-founders of the company retired from the board. It also formed a new Business Transformation and Strategy Review Committee at the time, pledged to reconstitute its Audit and Compensation Committee, and promised to introduce a new executive compensation plan that will better align pay with company performance and long-term shareholder value creation.
With today's announcement, however, it's apparent that those changes still weren't enough to appease the activist shareholder base. For now, the company has appointed Mary Winston, an industry veteran and one of the recent additions to the board, as interim CEO while it searches for a permanent replacement.
"This is an important time for Bed Bath & Beyond, and we are committed to being the leading omnichannel retailer of choice for the home and heartfelt life events," Winston said. " ... As we continue to review our business initiatives, we will be focused on driving continued margin improvement, enhancing the in-store and online experience, and accelerating our transformation to the benefit of our shareholders, customers, and other stakeholders."