Party City, the party supplies retailer that once dominated the U.S. market, will close all of its stores nationwide, including dozens in the Bay Area, by early next year.

In a meeting with company officials Friday, CEO Barry Litwin confirmed the closure and the company’s decision to cease operations after nearly four decades in the entertainment goods business.

“It’s really important for you to know that we did everything possible to try to prevent this outcome,” Litwin said, according to CNN, which observed the meeting. “Unfortunately, it is necessary to begin the resolution process immediately.”

The announcement marks a sobering chapter for the company, which had just emerged from bankruptcy just over a year ago. Despite efforts to restructure and reduce its $1.7 billion debt load, Party City was unable to recover from increasing financial pressures, which included increasing competition, rising costs and changing consumer habits.

For many in the Bay Area, the closures are another sign of the ongoing struggles of brick-and-mortar retail — especially in the wake of pandemic-related disruptions. Party City locations in Daly City, Richmond, San Leandro, San Rafael, Pleasant Hill, Redwood City, Fremont, Cupertino, San Jose and other local cities will be closed through February.

The California Department of Employment Development said it has not yet received notification of the expected layoffs.

At its peak, Party City operated more than 800 stores across the United States and, as of 2021, employed over 6,400 full-time and 10,100 part-time employees.

The company succumbed to pressure from online retailers like Amazon and competitors like Spirit Halloween, which has expanded beyond its seasonal niche. The chain’s balloon business, a core business of the chain, was also severely affected by the global helium shortage.

Despite the ongoing problems, many employees were surprised by Friday’s sudden announcement.

“We are aware that the flow of communication was not consistent with our usual approach to sensitive matters such as these,” Litwin admitted during the meeting.