Westwing Cuts Staff 42% and Catalog 74% as CEO Chases Profitability

Westwing has cut its workforce from 550 to 320 people and shrunk its catalog from 85,000 to 22,000 products since André Machado took over as CEO in August 2025, in a restructuring aimed at pulling the Brazilian furniture and décor retailer out of the red. The company, which burned roughly R$ 300 million in cash since its 2021 IPO, is now betting on cheaper everyday items, marketplaces and social commerce to revive falling sales.

The stakes are clear in the third-quarter results released Thursday. Net revenue fell 17.7% to R$ 30.5 million, while gross merchandise volume (GMV) dropped 23.3% to R$ 43.2 million. Westwing posted a net loss of R$ 2.7 million, reversing a profit of R$ 1.9 million a year earlier.

Machado attributes part of the contraction to the migration of its e-commerce operation to the Salesforce platform between July and September, which hurt order conversion. Pressure predates the migration. Over the first nine months of the year, GMV fell 10.5% and net revenue declined 4.5%, cushioned by a larger share of own-inventory products.

What is the new strategy?

Machado, who built his career in financial markets and logistics before joining Westwing, frames the turnaround in one line: profitability first, scale later.

— A nossa preocupação agora é ter uma empresa rentável e saudável, para depois focar no tamanho que ela pode ser. Porque eu acho que um dos erros que acabam acontecendo muito é querer correr antes de caminhar — the CEO said.

The portfolio will split into two lines. Westwing Collection keeps the sophisticated design furniture and objects; Westwing Essentials gathers everyday articles — kitchen items, tableware, bed and bath. Machado wants to accelerate the second line to reach consumers unwilling to make big-ticket purchases in a high-interest environment. Furniture and sofas still account for about 45% of sales.

— Num cenário de restrição de crédito, você acaba comprando coisas que precisa, não coisas que quer. Não preciso trocar o sofá da minha casa, não é urgente, estou com a grana mais apertada, não vou comprar. Mas quebrou um copo, vou ter que comprar um copo — he explained.

To gain volume on lower-ticket products, Westwing plans to expand on Mercado Livre — already its main marketplace — plus Amazon, TikTok Shop and Instagram channels driven by influencers. On the supply side, the company owns no factories and outsources production of its private label, concentrated mainly in Brazil. Machado just returned from a trip to China seeking suppliers to widen the portfolio and cut costs. Imports are expected to reach nearly 20% of sales by 2027, up from 9% today.

The own brand already carries the business: it represents almost 40% of gross sales volume. Three physical stores account for about 15% of sales, and the company plans to add smaller units of 150 to 250 square meters.

Is the restructuring working?

Profitability metrics are moving first. Westwing hit cash-neutral status for the second consecutive quarter. Gross margin rose from 40.2% to 41.3% in the third quarter, while recurring general and administrative expenses fell 10.1%. Ebitda, excluding lease accounting effects, stayed negative, but the deficit narrowed 60.6%, from R$ 2.9 million to R$ 1.1 million.

The biggest advance came in the cash cycle, which swung from 10.3 positive days to 54.4 negative days in one year — products sit in inventory for less time, sales are collected faster and suppliers are paid later.

— A gente caminha para o break-even tri a tri, a gente não crava quando vai ser, mas a gente caminha para isso — Machado said.

Who is the executive behind it?

Machado holds an administration degree from FGV and worked at Itaú BBA in corporate credit and investment banking. The finance background shapes his view of what sustains a business.

— Eu vi muita empresa que às vezes tinha uma ideia muito boa e captava dinheiro, mas o seu negócio era ruim. Você tem que ter uma boa tese, tem que ter um modelo econômico saudável — he said.

As a child he dreamed of playing professional basketball; today he plays tennis, runs marathons and competes in Ironman races. He describes his management style as obsessive about execution.

— Sou muito chato com follow-up, rotina e execução, porque todo dia é uma guerra. Você tem que ter esse senso de urgência — he said.

The takeaway in plain words: Westwing has fixed its cash engine, and the Essentials-plus-marketplace push is the test of whether demand follows.