Goldman Sachs analyst Heath Terry downgraded Blue Apron (APRN) to Neutral from Buy and cut his price target for the shares to $6 from $11 following the company's Q2 results.

The shares in afternoon trading are down 19% to $5.05. Blue Apron management disclosed "significant operational issues" relating to its fulfillment center transition that will drive revenue dropping 20% in the second half of the year relative to the first half, Terry tells investors in a post-earnings research note. The company is also seeing higher churn and lower order rates due to higher error rates, the analyst adds.

Terry admits to being "clearly wrong" on Blue Apron's logistical challenges and its ability to reaccelerate customer growth.