(Bloomberg) -- Billionaire Ryan Cohen pocketed a $68.1 million profit from the sale of his stake in Bed Bath & Beyond Inc., scoring a 56% gain on an investment he held for roughly seven months.

The retail traders who poured millions of dollars into the struggling retailer’s stock, on the other hand, may be just starting to feel the pain -- especially if they were late to the trade.

Bed Bath & Beyond shares, which were hammered on Thursday, plunged as much as 43% Friday after Cohen’s exit was disclosed in a regulatory filing. It’s setting up to be a repeat of other meme-stock moments, with the price drop being just as dramatic as its ascent.

The worst part for the Reddit crowd: It was Cohen’s very involvement in the stock that fueled their enthusiasm. The price at one point this week more than quadrupled from a recent low in July, with at least some pointing to a disclosure that showed the GameStop Corp. chairman still was holding onto his stake, which at that point exceeded 10% of the firm. It included call options that would only be in-the-money if the stock continued to soar.

But at that point, Cohen -- who made his initial fortune as the co-founder of pet supply retailer Chewy Inc. -- had begun to sell.

His RC Ventures paid $121.2 million between mid-January and early March to acquire 7.78 million shares and options to purchase another 1.67 million shares, a regulatory filing shows. He unloaded all of them this week for a combined $189.3 million, according to a filing on Thursday after the US market close.

A torrent of cash from retail traders pumped up Bed Bath & Beyond’s shares in recent weeks, even with the company’s financial situation deteriorating. They bought $58.2 million of the stock on Wednesday, a day after snapping up a record $73.2 million. Net purchases over three weeks totaled $229.1 million, according to data compiled by Vanda Research. 

Meanwhile, the Union, New Jersey-based company hired law firm Kirkland & Ellis to help it address an unmanageable debt load, according to a person with knowledge of the decision. The firm, known for restructuring and bankruptcy, will advise the retailer on options for raising new money, refinancing existing debt, or both.

Bed Bath & Beyond’s bonds and loans are already trading at distressed levels. The sharpest drop came after the company announced dismal earnings on June 29, though the debt dropped anew after Cohen’s filing. 

As of Thursday’s close, the retailer’s market value was about $1.5 billion.

In a filing Thursday, the company said it has been “working expeditiously over the past several weeks with external financial advisers and lenders on strengthening our balance sheet,” and would provide more information at the end of the month. 

Cohen, who was born in Montreal, co-founded Chewy about a decade ago and then sold it for $3.35 billion to rival PetSmart and a British private equity firm in 2017. By that time, Chewy was known across the US for its affectionate customer service, including sending hand-painted portraits of pets to their owners. But Cohen, who’d largely stayed out of the limelight despite the company’s success, was hardly a household name.

That changed in early 2021, as a daytrading mania gripped the country and retail traders fueled a run-up in the shares of GameStop and a handful of other firms. Months earlier, Cohen had taken a stake in the left-for-dead retailer and called for changes. He was appointed to the board and later became chairman. At the same time, he became a symbol in the ongoing mania: Robinhood traders’ David standing up to the Wall Street Goliaths.

Since then, he’s periodically fired off tweets, mixing mercurial messages with criticism of high-paid CEOs and Wall Street vultures only looking to make a buck, cementing his status among some retail investors.

That status is now in flux.

(Updates share price.)

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