Joann Fabrics and Crafts declares bankruptcy under Chapter 11

Joann Fabrics and Crafts files for Chapter 11 bankruptcy to restructure debt, citing declining sales and a growing net loss due to an unstable consumer market.

In an effort to restructure its debt, Joann Fabrics and Crafts has filed for Chapter 11 bankruptcy protection. Joann stated that its websites and retail locations would be open and run normally in a statement that was included with its filing. Joann's is believed to have over 850 locations across 49 states. Joann reported data for its most recent quarter that showed it had over $1 billion in debt, declining sales, and a growing net loss. The company attributed these findings to an unstable consumer market.

The revelation caused a negative reaction on Wall Street, with Joann shares falling by as much as 20%. In 2021, as the epidemic persisted and there seemed to be a surge in at-home, do-it-yourself consumer activity, the corporation went public. However, its shares are currently worth less than $0.25, having started at approximately $12 and increased to almost $17.

Following the announcement of Wade Miquelon's departure in May following a "challenging" year as CEO, Joann has been operating without a full-time CEO for the past seven years. According to the press announcement, Chris DiTullio, chief customer officer and co-lead of the interim office of the CEO, expressed gratitude for the industry and financial stakeholders' support of the agreement and their faith in their ability to continue bringing about constructive business change.