Cosmetics giant Revlon has filed for bankruptcy in the United States. It blamed its crippling debt and mounting celebrity competition as the reasons for filing a Chapter 11 bankruptcy protection.
In a news release, the 90-year-old cosmetics giant’s CEO Debra Perelman said, for now, consumers will still be able to buy their favourite items.
“Today’s filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth.”
She added that its “challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand”.
Successful celebrity cosmetic houses like Kylie Jenner’s Kylie Cosmetics and Rihanna’s Fenty Beauty have put a lot of pressure on traditional cosmetic houses to stay in business while competing with celebrities.
CNN reports that Revlon has also been hit by supply issues, made worse by the COVID-19 pandemic. Resulting product shortages were another major factor in tipping Revlon into bankruptcy, and analysts have said they were unlikely to be resolved in the near-term.
Over the last few years, it became evident that Revlon’s sales were lagging behind and it influenced its share prices as well. Since the beginning of this year, share prices have fallen more than 80%.
The company owns the Revlon brand, as well as Cutex, Almay and Elizabeth Arden. It also owns the fragrances of both Britney Spears and Christina Aguilera.
Image credit: NBC News