Claire’s Files for Second Bankruptcy in Less Than a Decade

Retailer cites mounting debt, shifting consumer trends, and tariffs as key challenges

Claire’s, the long-standing mall retailer known for its budget-friendly jewellery and accessories targeted at pre-teens and teenagers, has filed for Chapter 11 bankruptcy protection for the second time in under 10 years.

The company submitted its filing to a federal bankruptcy court in Delaware on Wednesday, citing increased competition, changing consumer behavior, and financial pressures from debt and trade policies as core reasons behind the move. Stores across North America are expected to remain open while the company explores strategic alternatives, which may include a potential sale.

Industry Pressures and Financial Challenges

“This decision is difficult, but a necessary one,” said Claire’s CEO Chris Cramer in a statement. “Increased competition, consumer spending trends, and the ongoing shift away from brick-and-mortar retail, in combination with our current debt obligations and macroeconomic factors, necessitate this course of action for Claire’s and its stakeholders.”

Claire’s Files is contending with a $496 million loan due in December 2026 and has reportedly stopped making rent payments on unprofitable stores, as well as halting interest payments on some of its debt, according to financial research firm Debtwire.

Retail analysts suggest that the bankruptcy filing is a consequence of ongoing operational struggles. Neil Saunders, managing director at research firm GlobalData, said Claire’s has been “suffering with a cocktail of problems, both internal and external, that made it impossible to stay afloat.” He added, “Claire’s has struggled to simultaneously manage its debts and service day-to-day operations. The prospects of it being able to pay loans as they become due are extremely slim.”

Shifting Retail Landscape

Claire’s has also been heavily impacted by broader shifts in consumer behavior. With more shoppers turning to e-commerce and digitally native brands, many mall-based retailers have seen declines in foot traffic and sales. The trend has been especially pronounced among younger consumers, who are increasingly seeking more customized and digitally engaging retail experiences.

Claire’s Files imports a large portion of its merchandise from Asian markets including China and Cambodia, making it vulnerable to trade-related costs. Recent tariffs imposed on imported goods—particularly under the Trump administration—have added pressure to the company’s already thin margins. These policy changes have affected retailers across the board, especially those dependent on low-cost international supply chains.

A Shrinking Store Footprint and Industry Trend

Claire’s previously filed for bankruptcy in 2018. At the time, the company operated over 4,500 stores worldwide. That number has since dropped significantly; Claire’s now operates approximately 2,750 stores in 17 countries, including locations under its Icing brand.

Despite its efforts to modernize and restructure in the years since its first bankruptcy, the company has struggled to adapt to changing market conditions. Analysts have noted that Claire’s Files product offerings and store format have not kept pace with evolving youth fashion trends or competitors that have leaned into digital-first strategies.

Saunders noted that rival retailers are “more attuned to what younger consumers want and have left Claire’s looking somewhat out of step with modern demand.”

Claire’s is the latest in a series of retailers to file for bankruptcy in 2025. Other brands that have sought court protection this year include Forever 21, At Home, and Liberated Brands—the owner of Quicksilver.

The company’s leadership said it will continue operations during the bankruptcy process while seeking to restructure its debt and business model for long-term viability. Further developments regarding the potential sale or restructuring plans are expected in the coming months.

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