The home goods retail chain revealed Wednesday it has secured more than $500 million in new financing as the cash-strapped company battles a slump in demand and profit.

The company said it would shut about 150 underperforming stores and cut about 20% of its workforce across its corporate and supply chain.

On Tuesday, Bed Bath, which is a favorite among retail traders, did not immediately reveal the size of the potential stock offering, which would be its first since 2014.

"The business is in real trouble and the fact that they are going to issue and sell stock without actually giving an amount of stock, that's pretty catastrophic," said Jim Dixon, equity sales trader at Mirabaud.

"They are running out of cash and desperately need to raise cash just to keep the business going."

The retailer had a long-term debt of $1.38 billion and only $107.5 million in cash as of the end of May.

Later in the day, the company is expected to disclose a roughly $375 million loan when it provides an update on its turnaround plans.

Its shares have gained more than 13% in the last two sessions following a roller-coaster ride triggered by billionaire Ryan Cohen's sale of his 9.8% stake.