Claire's Files for Second US Bankruptcy in Seven Years

Claire’s, the popular tween jewellery and ear-piercing retailer, has filed for bankruptcy in the US for the second time in seven years, citing declining consumer spending and a continued shift towards online shopping.

The company, which operates over 2,700 stores across 17 countries including the UK and France, disclosed in a Delaware court filing that it holds debts ranging from $1bn to $10bn.

Concerns about Donald Trump’s trade policies have added to uncertainty around Claire’s ability to repay a nearly $500m (£375m) loan due in December 2026.

Chief executive Chris Cramer described the move as “difficult but necessary”, blaming rising competition, changing consumer habits, and the broader move away from physical retail – all compounded by significant debt and wider economic pressures. He added that Claire’s is actively exploring strategic and financial partnerships.

While stores in the US and Canada will continue trading during the bankruptcy process, the company is reviewing all options for the future.

In the UK, where Claire’s has about 280 locations, the retailer has brought in advisers from Interpath to assess potential paths forward, including a possible sale or insolvency – both of which are likely to lead to widespread store closures.

According to the latest financial filings, Claire’s UK revenue fell nearly 1% to £136m in the year to 1 February 2024. It recorded a pre-tax loss of £4m, following a £5m loss the previous year, and employs more than 1,600 people.

The company’s French division, which runs 239 stores, entered receivership last month.

Retailers focused on high street and mall locations are facing increasing challenges as shoppers tighten their budgets and turn to online deals. Claire’s has also lost ground in ear-piercing services to competitors such as Superdrug in the UK.

Other mall-focused brands are similarly under pressure. In March, fast-fashion chain Forever 21 announced it would shut down its US operations after succumbing to intense online competition from brands like Shein and declining in-store footfall.

Macy’s is planning to shut more than 60 stores in 2025, as part of a broader initiative to close 150 locations over the next three years. The move comes amid a wave of restructuring in the retail sector, with major chains like 99 Cents Only and Rite Aid also filing for Chapter 11 bankruptcy last year to reorganize their businesses.

Claire’s, which is currently undergoing its second US bankruptcy process in seven years, is owned by Elliott Management and Monarch Alternative Capital—former creditors who took control after the company’s 2018 bankruptcy.

Back then, Claire’s was aiming to restructure $1.9bn in debt accumulated following its 2007 acquisition by private equity firm Apollo Global Management.