Bed Bath & Beyond disclosed in a regulatory filing on Thursday that it had defaulted on certain debt payments, weeks after the beleaguered retailer warned investors it was a contemplating filing for bankruptcy protection.
It is the most salient sign of strain yet for the retailer, which said earlier this month that it was exploring a possible bankruptcy filing after a disappointing holiday season. Bed Bath & Beyond has been looking for cash to help it avoid filing for bankruptcy, but time may be running out. The retailer on Thursday also warned in the filing that it did “not have sufficient resources” to pay its debt.
A bankruptcy filing could come within weeks, two people familiar with the matter said, speaking on condition of anonymity because the discussions are confidential. The people cautioned that no plans are yet certain. The retailer has been talking with Sycamore Partners to sell assets, including its Buy Buy Baby stores, as part of a possible bankruptcy.
“As we consider all paths and strategic alternatives, we continue to work with our advisors and implement actions to manage our business as efficiently as possible,” a Bed Bath & Beyond spokeswoman, Julie Strider, said. “As is our practice, we do not comment on speculation. We will update all stakeholders on our plans as they develop and finalize.”
The retailer employed about 32,000 workers as of February 2022 and has roughly 900 stores across the country. Since warning of its financial issues, Bed Bath & Beyond has continued to lay off workers and close stores to try to shore up its balance sheet.
In January, it reported a $393 million loss for the third quarter, 42 percent more than its losses from the same quarter a year earlier. Its net sales dropped to about $1.3 billion, 33 percent less than the year before.
Bed Bath & Beyond’s stock closed down 22 percent on Thursday, giving it a market capitalization of about $300 million.