Bed Bath & Beyond's CEO is out as sales tumble

New York(CNN Business) Bed Bath and Beyond CEO Mark Tritton is out after only three years at the helm of the rapidly sinking retailer.

The beleaguered company announced multiple changes to its leadership Wednesday, including replacing Tritton. In the interim, Bed Bath and Beyond has tapped Sue Grove, an independent director on the company's board, as its CEO until it finds someone permanent for the position.

"We must deliver improved results," Grove said in a statement. "Top-tier execution, careful management of costs, greater supply chain reliability, prudent capital spending, a stronger balance sheet, and robust digital capabilities will all be important to our success."

Bed Bath and Beyond (BBBY) poached Tritton from Target (TGT) in 2019. He was previously in charge of expanding Target's private label brands, which he tried to replicate at Bed Bath and Beyond. But those items haven't caught on with customers the same way they did at competitors -- nor did the company's redesigned stores.

Tritton's efforts did little to mask the company's deep-seated problems. On Wednesday, the chain reported significantly lower-than-expected earnings for the past quarter, and the brand's sales declined 27% from the same period a year ago.

That sent the company's stock falling as much as 20% in early trading. It's now down about 65% for the year.

Tritton's departure was "inevitable" and that the earnings report "does very little to inspire confidence in the company's trajectory," said Neil Saunders, managing director of GlobalData, in an analyst note.

"In our blunt view, this was a cosmetic reinvention—copied from Target—with very little substance behind it," Saunders said. "It is little wonder that it has quickly fallen apart."

He added that the company has "been run into the ground and a change of management is the only way of restoring some credibility with investors."

On Tuesday, a new report from Bank of America painted a bleak picture of the retailer, claiming that the company has cut air conditioning to quickly lower expenses to make up for a slump in sales. Bed Bath and Beyond told CNN Business that any changes in store temperature guidelines did not come from corporate.

"We've been contacted about this report, and to be clear, no Bed Bath & Beyond stores were directed to adjust their air conditioning and there have been no corporate policy changes in regard to utilities usage," said a representative.

Still, analysts at Bank of America who have conducted store visits report mounting concerns, including labor hours that have been meaningfully cut, scaled back utilities, reduced store operating hours and canceled remodeling projects. Rewards programs have also been scaled back and replaced. The analysts expect Bed Bath and Beyond's management will soon announce more store closures and halt openings of its Buy Buy Baby stores.

Other troubling factors for the company include the resignation of two key financial executives in recent months, chief accounting officer John Barresi resigned in May and Heather Plutino, senior vice president of financial planning and analysis and commercial finance also left the company.

-- CNN Business' Nicole Goodkind contributed to this report.