The Alternative Investment Market-listed company lost more than a quarter of its value, with the shares dropping 27.2% to 119.8p.
Purplebricks said 2018/19 revenues were now likely to range between £130 million and £140 million, down from the £165 million and £175 million range it forecast in the most recent interim results.
The estate agent said disappointing results from its US and Australian businesses were to blame. 'The Australian housing market has experienced a number of headwinds', it said, adding that in the US 'there has been a lower-than-expected response to the second US marketing initiative that concluded towards the end of January'.
Lee Wainwright and Eric Eckardt, UK and US chief executives respectively, are also leaving the business. Chief operating officer Vic Darvey will take on Wainwright's responsibilities on an interim basis while group chief executive Michael Bruce will take on the day-to-day running of the US business.
Today's heavy fall is the latest in a series of setbacks for the shares. After floating at 100p at the end of 2015, the shares soared to a high of nearly 500p just over 18 months later. But it's been downhill since, with a tough environment for UK estate agents weighing.
Woodford's big backing
Woodford is the biggest backer of the company, having invested prior to its flotation. His Woodford Investment Management fund group controls 29.5% of the shares.
At its height Purplebricks accounted for nearly 11% of the manager's Woodford Patient Capital (WPCT) investment trust, although now the shares represent only a 1.7% position. Shares in the trust were down 2% at 84p in the morning's trading.
Over the year to the end of December, the holding was the biggest single weight on both the Equity Income and Income Focus funds knocking 2.5% and 2.8% from respective returns.
The shares' decline meanwhile lopped 4.1% off the net asset value (NAV) of the Patient Capital trust over the same period, although that is eclipsed by the 7.4% dent to assets from the collapse in the shares of what was once the trust's biggest position, in Irish biotech firm Prothena (PRTA.O).
Despite those falls, Woodford's investment in the company remains among his most profitable over three years, contributing 4% to the Patient Capital NAV over that period.
Purplebricks' house broker Peel Hunt placed its 'buy' rating and 320p target price 'under review' on today's news. 'Given the tough trading backdrop in its ky regions and the recent changes to customer propositions in the US and Australia, revenue visibility is low and the near-term growth outlook has weakened,' said analyst Gavin Jago.
AJ Bell investment director Russ Mould said the company's problems were the result of 'trying to do too much, too fast'.
'Success in the UK gave the management confidence they could take over the world. Alas, that has proved nothing but a pipe dream.'