Posted: October 07, 2025 | Updated: January 20, 2026 at 12:21 PM
At Home Group Inc., a home décor and furnishings retailer with hundreds of large-format stores across the United States, filed for Chapter 11 bankruptcy protection in mid-June this year. At Home bankruptcy was caused by a heavy debt load after a private equity take-private deal in 2021, and the filing comes amid a steep falloff in consumer spending on home goods.
Under the restructuring agreement, At Home plans to eliminate approximately $2 billion of its debt and secure new financing to maintain its stores’ operations during bankruptcy. At the same time, the company will close dozens of underperforming stores to cut costs. These moves underscore a broader slowdown in the home furnishings retail sector after a post-pandemic boom.
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At Home Group Inc. traces its roots to 1979, when the first store, Garden Ridge Pottery, opened in Texas. The company has since grown into one of the largest home décor chains in the U.S., rebranding itself as At Home in 2014. Today, it operates roughly 260 warehouse-style megastores in around 40 states. Each store is approximately 80,000 to 105,000 square feet and offers an extensive assortment of items, including furniture, bedding, rugs, kitchenware, holiday decorations, and seasonal accessories. At Home’s strategy was to provide one of the largest assortments of home goods at extremely low prices. Each store is like a warehouse full of home décor items, appealing to bargain shoppers.
The chain is essentially a brick-and-mortar business. Before bankruptcy, roughly 90% of At Home’s revenue came from in-store purchases (with most shoppers browsing its physical locations). In 2016, At Home went public to raise funds for expansion. That growth continued until 2021, when private equity firm Hellman & Friedman agreed to buy the company in a deal valued at around $2.8 billion (including assumed debt). This take-private transaction significantly increased At Home’s leverage by saddling the balance sheet with nearly $2 billion of debt.
At Home utilized the proceeds from its IPO and subsequent private financing to accelerate the expansion of its nationwide store network. By mid-2025, the chain had more than doubled its store count in just a few years. The strategy was to capture market share by bringing its big “warehouse of décor” concept to new regions. But this expansion was primarily funded with borrowed money. The leveraged buyout left At Home with roughly $2 billion of funded debt on its balance sheet, and each new store added to that burden.
When consumer demand began to slow, the heavy debt became a drag. Interest rates rose in 2022 and 2023, making At Home’s debt service more expensive. By mid-2025, the company had approximately $2.0 to $2.1 billion in debt and was spending a significant portion of its cash flow on interest payments. In fact, At Home even missed an interest payment in May 2025, a clear warning sign of strain.
All of it triggered a forbearance agreement with its creditors and set the stage for the Chapter 11 filing.
Like many home goods retailers, At Home initially benefited from the COVID-era boom in home improvement. With people spending more time at home, sales of furniture, décor, and housewares surged in 2020 and 2021. The retailer’s vast stores, packed with seasonal and novelty items, saw a windfall of business as shoppers renovated houses and spruced up living spaces.
However, the scope of further growth didn’t last long. Starting in late 2022, consumer spending began to shift away from discretionary categories as inflation drove up the cost of everyday goods. Many households tightened their budgets amid higher grocery, fuel, and utility prices. In addition, mortgage rates climbed, cooling the housing market. Fewer home sales and renovations meant less demand for furniture and décor. In its bankruptcy filings, At Home cited a slow housing market and low consumer confidence as factors in the weaker demand.
The impact was evident on At Home’s store traffic and sales. Industry reports suggested that visits to At Home stores were down by roughly 20-25% compared to the pre-pandemic period. The 2024 holiday season, which typically accounts for approximately 40% of the chain’s annual sales, was weaker than expected, as shoppers reduced their spending on seasonal decorations. By early 2025, At Home found itself with excess inventory and softer revenue, while the costs of running its large stores remained high.
The company noted that many of its locations were operating at suboptimal performance levels under these conditions. The result was stalled revenue growth amid high fixed costs, forcing management to start cutting underperforming stores even before the bankruptcy filing.
At the same time that sales were slowing, At Home faced rising costs that squeezed its margins. The company imports roughly 90% of its merchandise, so the global rise in freight rates and new U.S. tariffs on imported furniture and décor hit it hard. During 2024, additional import duties were imposed on a range of home goods, and At Home explicitly blamed these tariffs for accelerating its financial woes. Company executives noted that the volatile trade environment came at a time when the management team was already working to address existing issues. In other words, the timing of the tariffs intensified the chain’s financial strain.
Beyond tariffs, general inflation also played a role. Higher prices for fuel, materials, and labor made each product more expensive to produce. At Home faced a choice: raise retail prices and potentially deter price-sensitive shoppers, or absorb the costs and take a margin hit. The company reported that it saw significant pressure on revenue due to these macroeconomic factors.
On June 16, 2025, At Home officially filed for Chapter 11 bankruptcy in Delaware. The filing followed a pre-negotiated plan with its lenders, known as a Restructuring Support Agreement (RSA). Under this plan, the company will eliminate most of its roughly $2 billion in funded debt. As part of the deal, lenders who hold over 95% of the debt will provide $200 million in new financing to keep the business running during bankruptcy, plus fold $400 million of existing debt into that financing (for a total of $600 million in debtor-in-possession credit).
The effect of the plan is essentially a debt-for-equity swap. The private equity owner (Hellman & Friedman) will be wiped out, and the lenders will become the new equity holders of the reorganized company. At Home’s statements emphasize that the plan will leave the chain with a meaningfully strengthened balance sheet. After bankruptcy, the company is expected to emerge with minimal debt, allowing it to focus on operations rather than interest payments. In first-day court filings, At Home also moved to keep employee payroll and vendor payments current, signaling that it would remain open for business during the restructuring.
The RSA anticipates exiting Chapter 11 by late 2025 or early 2026. If the reorganization plan is approved, creditors will take ownership of the company, and most of the $2 billion debt will be discharged. The newly capitalized chain could then operate under new ownership with a far lighter financial burden.
Management says that with debt gone, the company can invest in its stores and product selection to compete more effectively.
A significant part of At Home’s restructuring is cutting costs by shrinking its store base. The bankruptcy filings revealed plans to close 26 stores by September 30, 2025. These locations are scattered around the country – for example, several in California, two in New York (Rego Park and the Bronx), one in Florida (North Miami), and others. In total, the 26 stores account for about 10% of the chain’s footprint. (Earlier in 2024, At Home had already shuttered six stores as demand cooled.) Once the closures are complete, roughly 230 stores will remain open nationwide.
The closures are focused on the weakest and most overlapping markets. By exiting these underperforming sites, At Home will save on rent, labor, and inventory costs. The company plans to liquidate its remaining stock at the closing locations and assist affected employees with transfers or severance packages. In its filings, At Home noted that the high fixed costs of brick-and-mortar retail mean many stores could not cover their expenses with current sales. Cutting the bottom 10% of stores should help improve profitability across the chain.
Beyond closures, At Home has taken other operational steps to trim expenses. The retailer paused plans for new store openings and has tightened inventory purchases to avoid excess. Corporate overhead and marketing expenditures have also been reduced. These measures aim to maintain a positive cash flow during the Chapter 11 process.
At Home’s leadership says the goal is to emerge from bankruptcy running a smaller but healthier network of stores, with a leaner cost structure and renewed focus on core merchandising.
If all goes according to plan, At Home will exit bankruptcy late in 2025 or early 2026 with a positive scope on its balance sheet. The chain will emerge still operating, with roughly 230 stores, but most of its debt will be eliminated. Lenders who financed the restructuring (potentially including significant investment funds) will now control the company, meaning the old shareholders have been wiped out. The bankruptcy has turned debt into equity for the creditors.
The hope is that the reorganized At Home can operate with much lower interest expenses, freeing up cash for the core business. With debt largely gone, executives say the focus can shift back to serving customers, optimizing inventory, and improving store operations. Management has discussed continuing to refine the store experience and deliver exceptional value to shoppers to drive future sales growth.
However, emerging successfully will not be guaranteed. Industry observers note that eliminating debt only buys time. At Home will still face a challenging retail environment. To succeed, the chain must address any underlying weaknesses in its business model. Analysts warn that the company needs to reevaluate key aspects of its business model, including merchandising and marketing, as well as its online presence, to justify its stores.
At Home’s struggles come amid a broader shakeout in the home furnishings retail sector. In recent years, several large home goods chains have filed for bankruptcy or closed numerous stores. For instance:
These examples illustrate the increasing volatility of this category. Retailers that rode the pandemic home makeover trend found the upturn was short-lived and are now facing leaner times. Meanwhile, At Home contends with fierce competition. Online giants like Amazon and Wayfair offer huge catalogs of home items with convenient delivery.
Off-price brick-and-mortar rivals, such as HomeGoods (a TJ Maxx brand) and IKEA, also draw bargain shoppers. Even mass retailers like Walmart and Target offer a wide range of home décor products. In this crowded market, At Home’s mega-warehouse of décor concept remains unique, but it will need to keep customers engaged as spending habits evolve.
The Chapter 11 filing gives At Home a fighting chance, but it is no sure thing. On the positive side, the company will emerge much less leveraged, free of the hefty debt that once threatened its survival. With its creditors now focused on ensuring the chain’s success, At Home can invest in its stores and products without the burden of interest costs. The brand still has a broad national reach, and many stores will remain open to serve loyal customers.
On the other hand, key challenges remain. If consumer interest in home decorating does not rebound, the retailer will have to work hard to win back shoppers. Competition will be intense, and inflation or high interest rates could keep household budgets tight. Industry experts note that while reducing debt creates breathing room, At Home must still enhance the shopping experience and product mix to attract customers. The following year or two will be critical: the company needs to show it can drive sales without the previous safety net of easy credit.
At Home took on about $2 billion in debt from a 2021 buyout and rapid expansion. When post-pandemic sales of furniture and décor slowed, high inflation and tariffs squeezed margins, and it missed an interest payment, forcing it to file for Chapter 11 bankruptcy.
The company will close 26 of its 250-plus stores by September 2025 (about 10%). Those locations will hold liquidation sales, while roughly 230 stores remain open as At Home focuses on profitable sites.
Lenders will swap over $1 billion of debt for equity, taking control of the company. At Home also secured $200 million in financing to operate during bankruptcy, and its former private-equity owner will lose its stake.
No. After a pandemic boom, many home-goods chains (e.g., Bed Bath u0026amp; Beyond, Pier 1) went bankrupt as spending shifted to travel and essentials, and the housing market slowed. At Home was hit harder because it expanded quickly into large stores.
With less debt and fewer stores, At Home has a better chance of regaining profitability and investing in inventory and online sales. But success depends on whether consumer demand for home goods recovers and how well management adapts its model.
