A Forever 21 store in New York was photographed in February 2025. The retailer, known for fast fashion, has faced financial challenges resulting in its US operating company filing for bankruptcy for the second time in six years. The filing cited intense competition from foreign fast fashion retailers. Despite the bankruptcy filing, Forever 21 stores and the website in the United States will remain open for the time being, but the company is planning an “orderly wind-down” of its US operations. Liquidation sales will be held at stores, and efforts are being made to find a buyer for some or all of its assets.
Brad Sell, the company’s CFO, mentioned that they struggled to compete with foreign fast fashion companies, rising costs, economic challenges, and changing consumer trends. Forever 21 has lagged behind Chinese e-commerce giants like Shein and Temu, particularly as online shopping grew during the pandemic. The retailer has also faced challenges due to tariffs on Chinese imports imposed by President Donald Trump.
The fast fashion industry has been criticized for its environmental impact, with cheaply produced clothes contributing to waste. Analysts have noted that Forever 21’s merchandising and brand image have been lackluster, leading to a decline in its customer base, especially among younger consumers.
After filing for bankruptcy in 2019 and closing 200 stores, Forever 21 was purchased by a consortium of mall operators and a brand management firm. Despite efforts to revive the brand, the retailer’s future remained uncertain.
The closure of Forever 21 stores adds to a trend of store closures among US retailers, with over 7,300 closures announced in the previous year. The brand currently operates over 540 locations globally, down from 800 before its initial bankruptcy filing.
While the future of Forever 21 remains uncertain, there is speculation that the brand could live on through licensing agreements or potential sales to e-commerce and brand groups. CNN’s Nathaniel Meyersohn contributed to this report.
