The iconic fast-fashion brand Forever 21 has once again filed for bankruptcy protection.

Fast fashion giant Forever21 has filed for bankruptcy protection for the second time in six years, announcing the closure of all its US stores and the liquidation of over 350 locations, with total liabilities reaching $1.58 billion. Management partly blamed the low-cost competition from emerging e-commerce players such as Shein and Temu, which eroded Forever21's price competitiveness.

While the US operating company is headed for liquidation, the Forever21 brand and intellectual property remain under Authentic Brands Group (ABG) and will continue to operate in other regions of the world. ABG remains optimistic about the brand's future and is seeking a new operator to take over the US business, but the chances are low. More than 200 potential bidders have been contacted, but no viable transaction has been reached.

Forever21 was once a pioneer in the fast fashion industry, with peak annual sales of over $4 billion. After a brief recovery following its first bankruptcy, it recorded revenue of $2 billion in the 2021 fiscal year. However, it has been plagued by deteriorating performance due to factors such as increased competition, inflation, supply chain issues, and changing consumer preferences.