Bankruptcy: Party City Goes Out of Business After 40 Years

Party City is closing down all of its stores, ending nearly 40 years in business. CEO Barry Litwin told corporate employees Friday in a meeting that Party City is “winding down” operations immediately and that today will be their last day of employment. Staff were told they will not receive severance pay, and they were told their benefits would end as the company goes out of business.

Party City exited bankruptcy a month after Litwin’s arrival. It had declared bankruptcy in January 2023. The company had struggled to pay off its $1.7 billion debt load, and it was able to cancel nearly $1 billion in debt by going bankrupt. It also managed to keep most of its more-than 800 stores open, although it closed more than 80 locations between the end of 2022 to August 2024, according to its most recent financial documents. But it still had more than $800 million in debt to overcome, which strained earnings this year.

While the news is still developing, it's likely to have several impacts:

• Job losses: Party City employs thousands of people, and many will lose their jobs as stores close.  
• Reduced consumer access: Consumers will have fewer options for party supplies, especially in areas with limited competition.
• Impact on local businesses: Businesses that rely on Party City for supplies or foot traffic may experience a decline.