Shoppers are abandoning Wayfair Business CNN

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Wayfair lost more than a million customers in its most recent quarter as shoppers ditched new furniture and home decor.

The e-commerce retailer said its number of active customers fell 22.6% in the quarter ended Sept. 30 compared to the same time last year.

The company’s sales were also down 9% during the quarter from a year ago. It lost $283 million.

Shares of Wayfair ( W ) rose 7% on Thursday as the results were better than Wall Street had feared. Still, the company’s shares have plunged nearly 80% this year.

“Wayfair’s business is not working and it’s losing a lot of market share,” said Neil Saunders, an analyst at GlobalData Retail.

There has been a broader slowdown in the furniture and home goods sector after a boom in 2020 and 2021, when many customers unable to travel or go to the office spent money redecorating their houses

Persistent inflation, which reached 8.2% in September, has also hit low- and middle-income shoppers, who have pulled back on discretionary purchases to focus on paying for necessities like groceries, gas and rent .

Wealthier customers have also shifted their spending from furniture and other goods to travel and services. Mortgage rates have risen dramatically, reducing demand for new homes.

“We’re seeing shoppers become more deliberate with their spending patterns as they look for great value and wait for promotions,” Wayfair CEO Niraj Shah said on a call with analysts Thursday.

Wayfair recently said it will cut nearly 900 jobs, or about 5 percent of its workforce, and pause an international expansion plan.

Other furniture stores have also been hit hard by the furniture slowdown, including RH ( RH ) and Williams-Sonoma ( WSM ), owners of West Elm and Pottery Barn.

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