By Sam Boughedda
The RealReal, Inc. (NASDAQ:REAL) will lay off approximately 230 employees representing around 7% of its workforce, the company said in a filing.
The workforce reduction is part of the luxury reseller's plan to reduce operating expenses.
RealReal will also reduce its real estate presence by closing two flagship stores in San Francisco, California, and Chicago, Illinois, two neighborhood stores in Atlanta, Georgia, and Austin, Texas, and two luxury consignment offices in Miami, Florida, and Washington, D.C.
In addition, it will reduce its office spaces in San Francisco, California, and New York, New York.
The company estimates it will incur non-recurring charges of approximately $1.7 million to $2.2 million in connection with the cost reduction plan, primarily consisting of severance payments, employee benefits contributions, and related costs, with the majority of these charges expected to be incurred in the first quarter of fiscal 2023.
The implementation of its headcount reductions, including cash payments, is expected to be mostly complete by the end of the first quarter of fiscal 2023.