NEW YORK (CNN) — Party City is closing all of its stores, ending a nearly 40-year run, CNN has learned.
Chief Executive Officer Barry Litwin told company employees Friday that Party City was “winding down” operations immediately and that today would be their last day of employment during a meeting viewed by CNN. .
“This is without a doubt the most difficult message I have ever had to convey,” Litwin said during the meeting, which was held via video conference. He added that Party City’s “best efforts were not sufficient to overcome the financial challenges,” which resulted in the company’s bankruptcy.
“It is very important that you know that we have done everything possible to avoid this outcome,” Litwin said. “Unfortunately, we must begin the downsizing process immediately.”
Party City did not immediately respond to CNN’s request for comment.
There’s a Party City store in Onalaska’s Crossing Meadows Shopping Center.
bankruptcy and collapse
The chain is the largest party supply store in the United States and recently emerged from bankruptcy in September 2023. The plan included canceling nearly $1 billion in debt, liquidating the company’s stock, and keeping most of its 800 U.S. stores open.
Although Party City was able to avoid the same fate as Bed Bath & Beyond and 99 Cents Only Stores in the short term, it still has more than $800 million in debt, which will cut into its earnings this year. was pressed.
The company had closed more than 80 stores between the end of 2022 and August 2024, according to its latest financial filings.
Party City said in an earlier statement that it had renegotiated a number of leases and exited “less productive locations,” resulting in many of the chain’s employees retaining their jobs. The company has approximately 6,400 full-time employees and 10,100 part-time employees as of 2021.
Party City filed for bankruptcy in January 2023 after struggling to pay off $1.7 billion in debt. As a result, the company was delisted from the New York Stock Exchange.
The New Jersey-based company announced Litwin as its new CEO just four months ago. In a post on LinkedIn, he said the company’s “key priority is strengthening our financial health, and we have challenges ahead of us.”
Party City’s net sales fell to $407 million in the three months ended September 2023, compared to $502 million in the same period in 2022, according to the company’s latest financial disclosures. .
The company, which sells balloons, Halloween costumes and other party supplies, has stumbled in the face of increasing competition from e-commerce sites and pop-up concepts like Spirit Halloween. Competition from big retailers like Amazon, Walmart, and Costco has also decimated smaller chains.
It also had to deal with rising costs and helium shortages during the pandemic, which hurt its vital balloon business.
The chain joins a growing list of retailer bankruptcies this year as customers cut back on discretionary spending amid rising costs of living. Notably, Big Lots announced Thursday that it would begin “going out of business” sales at all of its stores after a private equity firm’s plan to rescue the bankrupt retailer failed.
Major chains are expected to close more stores in 2024 than in any year since 2020, according to Coresight Research.
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CNN’s Ramishaa Maruf and Nathaniel Mason contributed to this report.
