Party City is closing all of its stores, ending nearly 40 years of business, CNN has learned. CEO Barry Litwin told company employees in a meeting watched by CNN on Friday that Party City was immediately “ceasing operations” and that it would do so today. “This is, without question, the hardest message I’ve ever had to deliver.” said Litwin at the meeting, which took place via video conference. Party City’s “very best efforts were not enough to overcome its financial challenges,” he added, leading to the company’s collapse. “It’s really important for you to know that we did everything possible to try to avoid this outcome,” Litwin said. “Unfortunately, it is necessary to begin a resolution process immediately.” Party City did not immediately respond to CNN’s request for comment. Bankruptcy and Collapse The chain is the largest party supply store in the United States and recently emerged from bankruptcy in September 2023. That plan included canceling nearly $1 billion in debt, liquidating its stock, and opening the majority of its 800 U.S. stores. In the short term, however, Party City managed to avoid the same fate as Bed Bath & Beyond and 99 Cents Only Stores still had over $800 million in debt to pay off, weighing on earnings that year. The company had closed more than 80 stores from the end of 2022 to August 2024, according to its most recent financial documents. Party City said in an earlier statement that it had renegotiated many of its leases and exited “less productive locations,” resulting in many of the chain’s employees remaining employed. The company employed approximately 6,400 full-time and 10,100 part-time employees in 2021. Party City filed for bankruptcy in January 2023 after struggling to pay off its $1.7 billion debt load. As a result, it was also delisted from the New York Stock Exchange. The New Jersey-based company announced Litwin as its new CEO just four months ago. In a LinkedIn post, he said the company’s “main priority is to strengthen our financial health, and we have a lot of work ahead of us.” Party City’s net sales fell to $407 million in the three months ended September 2023 down from $502 million in the same period in 2022, according to the company’s latest financial disclosures. The company, which sells balloons, Halloween costumes and other party supplies, has stumbled amid growing competition from e-commerce sites and pop-up concepts like Spirit Halloween. Competition from major retailers like Amazon, Walmart, Costco and others has also crushed smaller chains. The company also struggled with rising costs during the pandemic and a helium shortage that affected its key balloon business. The chain joins a growing list of retailers that have experienced bankruptcies this year as customers cut back on leisure spending amid rising living costs. Notably, Big Lots announced Thursday that it would begin closing operations at all of its locations after a private equity firm’s plan to rescue the bankrupt retailer failed. Major chains are on track to close the most stores in 2024, more than in any year since 2020, according to Coresight Research.