Saks Global Nears Bankruptcy Amid Luxury Sector Slowdown
The retailer's imminent Chapter 11 filing, born from heavy debt and waning demand, sends a warning shot across the high-end retail landscape.
Saks Global is preparing to file for Chapter 11 bankruptcy protection as it grapples with a crippling debt load and a broad deceleration in the luxury goods market. The parent of the iconic Saks Fifth Avenue and Neiman Marcus brands is in the final stages of negotiating a debtor-in-possession financing package, reportedly between $1.25 billion and $1.75 billion, to maintain operations during a court-supervised restructuring.
The move, which could be announced as soon as this week, follows a tumultuous period for the company. The retailer's financial woes are largely attributed to substantial debt taken on during its 2024 merger with rival Neiman Marcus, a deal designed to create a dominant force in American luxury retail. Instead, the combined entity has struggled under the weight of its obligations amid a rapidly changing consumer environment.
Saks Global's distress is a high-profile symptom of a wider malaise affecting the luxury sector, which is confronting the end of a post-pandemic spending boom. After years of record sales and aggressive price increases, luxury brands are facing a more discerning and value-conscious consumer. According to a report from Bain & Company, the personal luxury goods market is expected to see growth slow to between 3% and 5% in 2026 after a stagnant 2025, a stark contrast to the double-digit expansion seen previously.
The pressures are manifold. The crucial Chinese market, long a powerful engine of growth, has seen demand cool amid economic uncertainty. Simultaneously, many ultra-high-net-worth shoppers are reallocating their spending from high-end goods to exclusive experiences like travel and wellness, as noted in a recent analysis by J.P. Morgan Global Research.
This challenging backdrop has exposed vulnerabilities at highly leveraged companies like Saks Global. The company reported a net loss of $232 million in the first quarter of 2025, and its struggles have been compounded by a crisis of leadership. In recent weeks, Saks has seen the departure of several top executives, including CEO Mark Metrick and Executive Chairman Richard Baker, signaling deep instability at the firm's highest levels.
The impending bankruptcy is a warning for the entire luxury ecosystem, from department stores to individual brands. The era of driving growth primarily through steep price hikes appears to be over, with one Bain study noting that shoppers feel 'betrayed' by the strategy. According to a State of Fashion report by McKinsey, the industry is facing a period that will require fundamental reinvention rather than incremental adjustments.
While the U.S. market has remained a relative bright spot, the collapse of a retailer of Saks Global's scale underscores the sector's fragility. As the company prepares for a complex restructuring, its fate will be closely watched as a barometer for the health of luxury retail in a new, more sober economic reality.