What happened

Shares of Bed Bath & Beyond (BBBY) plunged as much as 23.4% on Wednesday, sinking to their lowest point since April 2020. As of 10:27 a.m. ET today, the stock was down 21.7%.

The catalysts that sent the home goods retailer cratering were a first-quarter financial report that was far worse than investors anticipated and a shake-up among its top management.

So what

Bed Bath & Beyond reported net sales of $1.46 billion, down a whopping 25% year over year, as comparable-store sales slumped 23%. Things went from bad to worse, as its gross profit margin of 23.9% was far worse than the 32.4% it recorded in the prior-year quarter. This resulted in a net loss of $358 million, or a loss per share of $4.49. 

To give the top- and bottom-line numbers context, analysts' consensus estimates were calling for revenue of $1.5 billion and a loss per share of $1.39 -- so the company failed to clear an already low bar, sending investors flocking to the exits. 

There was other news that gave Bed Bath & Beyond investors pause, in the form of a C-suite shake-up. In a separate news release, the company announced that Mark Tritton was ousted from his role as president and CEO, and independent director Sue Gove had been named interim CEO, while the company searches for a new chief executive. 

Now what

Bed Bath & Beyond has struggled in recent years as consumers made the leap to e-commerce, spending less time at home goods retailers. The company has been burning cash at an alarming rate, as cash flow from operations came in at a negative $400 million. That leaves the company in a precarious financial position, with just $107 million in cash on its balance sheet -- giving it less than three quarters of reserves at its current burn rate.

Management said, "We are committed to addressing the urgent issues that have been impacting sales, profitability, and cash flow generation."

The company's outlook was far from encouraging, though it expects sales to recover somewhat in the second half. Given the host of challenges it faces, investors would do best to leave Bed Bath & Beyond stock on the shelf, at least until there are concrete signs that a recovery is underway.