Bed Bath & Beyond Abruptly Converts RSUs Into Cash Bonuses
Retailer rethinks rewarding employees with plunging shares.
June 30, 2022
With shares down 83.7% in the last year, Bed Bath & Beyond (BBBY) no longer thinks rewarding employees with stock is a great idea in all cases. With the headlines accompanying earnings— that the firm is in its end days after firing its CEO— a change in bonus compensation isn’t likely a top priority for investors.
Bit with liquidity now a concern, the change will negatively impact the company’s cash flow statement in ways it previously hasn’t.
In its latest quarterly filing, Bed Bath & Beyond disclosed its intention to convert certain equity awards:
“In May of 2022, the Company determined that the RSU awards issued under its incentive compensation plans in May of 2022 would be settled in cash, rather than in equity.”
Shares have plunged 63.5% since May.
The change means the awards issued in May of 2022 will now be accounted for as a liability and measured at their fair value through their respective vesting periods. The cash settled RSUs will reduce Bed Bath & Beyond’s cash flow by $13.7 million over the next three years, or approximately $1.14 million per quarter.
Related: TGT, WMT, HD, COST
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