Party City, a popular party supply retailer, announced on Friday that it will be closing all of its stores and initiating corporate layoffs. The decision comes after ongoing financial challenges, including a recent bankruptcy filing in which the company was unable to pay off $1.7 billion in debt.
CEO Barry Litwin delivered the difficult news to corporate employees in a meeting, stating that the company must begin a winddown process immediately. This marks the end of an era for Party City, as Litwin expressed his regret in having to deliver such a message.
The New Jersey-based chain had previously filed for bankruptcy protection less than two years ago, emerging in September 2023 as a privately held company after canceling nearly $1 billion in debt. Litwin, who was appointed CEO in August, had expressed optimism about strengthening the company's financial performance and providing a leading celebration experience for consumers.
However, competition in the party goods and costume space has intensified in recent years, with companies like Spirit Halloween gaining traction both within and outside of the Halloween season. The rise of online retailers has also added pressure to Party City's operations, despite efforts to sell products on platforms like Amazon.
Representatives for Party City have not yet responded to requests for comment on the closure announcement. The decision to shut down all stores marks a significant shift for the company, which had previously struggled to overcome financial obstacles. As Party City begins the process of winding down, consumers and industry experts will be watching closely to see how this decision impacts the party supply market.