12:50

Purplebricks, the largest online estate agent, is having a very bad day. Rob Davies reports:



Shares plunged 40% after the company slashed its revenue forecasts and announced the surprise departure of both its US and UK bosses.

The company blamed slower than expected growth in its fledgling US business and “headwinds” in Australia, as it said revenue for the year was unlikely to exceed £140m compared with an earlier forecast of up to £175m.

The revenue prediction had already been downgraded once, at the time of its disappointing half-year results, from £185m.

Shares dropped by 40% after the news but later staged a partial recovery. However they were still down 28%, at 118p, cutting the company’s market value by £140m.

The fall is bad news for Woodford Investment Management, led by the City investment guru Neil Woodford, which is the largest shareholder in the company, with a stake of about 27%.

Purplebricks’ founder and global chief executive, Michael Bruce, is to take control of the US business with immediate effect, as its US chief executive, Eric Eckardt, leaves the business. No reason was given for his departure but revenues in the US grew less rapidly than the company had hoped, after a lacklustre response to a marketing drive that finished in January.

The UK chief executive, Lee Wainwright, is also leaving. The company said this was for “personal reasons”.