Heavy Debt Burden
Toys R Us filed for Chapter 11 bankruptcy in September 2017. The company carried roughly $5 billion in debt, much of it from a 2005 leveraged buyout. This debt load made it difficult to invest in stores and compete effectively.
Intense Retail Competition
The company faced growing pressure from big-box retailers and e-commerce leaders. Competitors offered lower prices, faster shipping, and more convenient shopping experiences. Toys R Us struggled to match these advantages while still servicing its debt.
Store Closures and Liquidation
After exiting bankruptcy in 2018, Toys R Us planned to relaunch with smaller, updated stores. However, the company quickly ran out of cash and announced the closure of all U.S. locations. The liquidation wiped out thousands of jobs and left empty shelves across the country. For more details, see the company's bankruptcy filing overview on the U.S. Courts website here.
