Forever 21 To Exit U.S. Market Amid Intense Competition

Forever 21 is officially bowing out of the U.S. market.

Forever 21's run in the US has come to an end. I Photo: Raysonho @ Open Grid Scheduler / Scalable Grid Engine

The retailer’s U.S. operating company filed for bankruptcy—for the second time in six years—in a Delaware court, citing relentless competition from foreign fast-fashion giants.

The move signals the end of an era for a brand that introduced many teenagers to affordable, trend-driven clothing, CNN journalists Anna Cooban and Ramishah Maruf reported.

Despite the filing, Forever 21 stated that its stores and website in the U.S. will remain open temporarily as it carries out an “orderly wind-down” of operations. The company plans to conduct liquidation sales at its stores while seeking potential buyers for some or all of its assets.

“We have been unable to find a sustainable path forward, given competition from foreign fast fashion companies… as well as rising costs, economic challenges impacting our core customers, and evolving consumer trends,” said Brad Sell, Forever 21’s Chief Financial Officer.

U.S. businesses often file for Chapter 11 bankruptcy protection to restructure operations, eliminate debt, and cut costs. However, the challenges facing Forever 21 extend beyond finances.

Shopping malls—once the brand’s stronghold—have been struggling with declining foot traffic and store closures for years, a trend exacerbated by the pandemic.

Meanwhile, fast-growing Chinese e-commerce platforms like Shein and Temu have outpaced traditional retailers by capitalizing on online shopping trends. Forever 21 has also felt the impact of President Donald Trump’s tariffs on Chinese imports, further straining its operations, CNN journalist Nathaniel Meyersohn added.