At Home Bankruptcy: What happened?

On June 16, At Home, the big-box home décor retailer with more than 260 stores nationwide, filed for Chapter 11 bankruptcy protection in Delaware. The company is carrying nearly $2 billion in debt, plans to close at least 26 underperforming locations, and will now transfer ownership to its lenders as part of a restructuring plan.

At first glance, it might look like just another casualty of changing consumer habits or a sluggish retail environment. But this wasn’t some out-of-nowhere implosion.

From skyrocketing tariffs on Chinese imports to a crushing private equity debt load and a string of strategic misfires, At Home was headed for trouble long before the bankruptcy paperwork hit the courts. Credit downgrades, executive turnover, missed interest payments, and public admissions of distress all piled up in plain sight.

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What Drove the Collapse

At Home’s bankruptcy filing wasn’t just a financial cleanup. It was a full-on unraveling. The plan is to restructure nearly $2 billion in debt, shut down 26 underperforming stores, and hand the keys over to its lenders. Even Texas, where the brand is headquartered and has long been strong, couldn’t shield them from what was coming.

So, what went wrong?

Tariffs Torched Their Margins

At Home relied heavily on Chinese imports to keep shelves full of low-cost home goods. When tariffs surged — peaking at 145% — their margins took a beating. Even when those rates eased to around 55%, the financial hit lingered. Worse, leadership admitted this spring that they were still scrambling to find alternative suppliers. That isn’t a strategy. That’s a scramble.

Debt Piled Up Consistently

Private equity firm Hellman & Friedman took At Home private in 2021, piling on debt in the process. When consumer demand cooled, that debt became unmanageable. In May 2025, they missed an interest payment. The countdown to default had already started.

Consumers Just... Stopped Buying

With interest rates high and inflation sticking around, shoppers shifted focus to essentials. Decorative pillows and accent furniture didn’t make the cut. That kind of pullback is brutal for a retailer built on low-cost, high-volume, nice-to-have goods.

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The Early Warning Signals

This wasn’t a sudden failure. Here’s what credit and risk teams could’ve flagged:

• April 2024: CEO Brad Weston (former Party City exec) was brought in to lead a turnaround. That’s two distressed companies on his recent résumé.
• October 2023: Fitch Ratings issued a cautionary note on their debt exposure.
• April 2025: The company publicly admitted it might need to file due to tariffs.
• May 2025: At Home missed a key debt payment and entered forbearance, set to expire June 30.
• Store growth despite shrinking margins. They kept expanding even as their cost of goods rose and foot traffic fell.

Any one of these might’ve looked like noise. When linked together, the data was telling a clear story.

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How to Get & Stay Ahead

So how can credit teams spot the signs before it’s too late?

• Look beyond the credit reports. Traditional bureaus didn’t raise red flags. But if you looked at leadership shakeups, tariff exposure, and store closures in the public domain — the writing was on the wall. Real insight comes from connecting the dots across news, permits, and signals most reports ignore.
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• Watch for supply chain red zones. At Home’s heavy reliance on Chinese imports became a silent killer. Tariffs jumped to 145%, and they had no backup plan. If you see that kind of exposure and no pivot in sight, that’s your moment to reassess terms or step back altogether.
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• Pay attention to PE-fueled growth. When private equity enters the picture, debt usually follows. Add in rapid store expansion and softening demand, and it’s a powder keg. Fast growth can look good on paper... until it doesn't.

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The Bottom Line

At Home’s bankruptcy is a case study in what happens when risk gets buried under debt, delayed pivots, and boardroom optimism.

Want to see how we catch these signs before it’s too late? Try Credit Pulse free for 30 days →

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