Saks Global Files Bankruptcy, Sending Shockwaves Through Luxury Retail
Overview
Saks Global has officially filed for bankruptcy protection, marking a significant blow to the luxury retail sector. The move follows months of speculation and a challenging post-pandemic recovery, compounded by a difficult acquisition of Neiman Marcus. Sales declines at Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman have accelerated financial distress. The company seeks to restructure debts owed to major luxury brands like Chanel and Kering.
Saks Global, the luxury department store conglomerate, has officially filed for bankruptcy protection late last night, confirming months of market speculation. The filing represents a substantial jolt to the high-end retail sector and the broader industry.
Acquisition Woes
The bankruptcy comes just over a year after Saks acquired Neiman Marcus, bringing fellow luxury retailers Bergdorf Goodman under the same umbrella. This consolidation, however, has not yielded recovery. The company has struggled against the surge of online retailers and a shift in consumer habits favoring direct-to-consumer sales.
Financial Strain
Sales figures paint a grim picture. For the quarter ending June 30, 2025, Saks Fifth Avenue saw a 16 percent drop in sales compared to the previous year. Neiman Marcus and Bergdorf Goodman's combined sales also decreased by 10 percent year-over-year. The company's assets and liabilities are currently estimated to be between $1 billion and $10 billion, according to filings with the U.S. Bankruptcy Court in Texas.
Operational Continuity and Leadership Shift
Saks Fifth Avenue stores will continue to operate, supported by a $1.75 billion financing package. However, leadership is changing. CEO Richard Baker, who spearheaded the Neiman Marcus acquisition, has stepped down. He will be succeeded by former Neiman Marcus CEO Geoffroy van Raemdonck.
Vendor Relations Under Pressure
Mounting debt has severely impacted Saks Global's ability to pay its vendors. Significant outstanding payments include approximately $136 million to Chanel, $60 million to Kering, and $26 million to LVMH. In its filing, Saks attributed its issues to "inventory availability and vendor confidence, not underlying demand for luxury goods."
Historical Context
The first Saks Fifth Avenue store opened in 1924, becoming a symbol of high-end retail for decades. Its current financial distress places the future of this iconic brand in serious jeopardy.
