Vicarious Music & Media

Circuit City closing 20% of their stores

 

Circuit City

RICHMOND, Va. – As the lights go out at about 20 percent of Circuit City‘s stores, the company is hoping that by closing hundreds of stores and cutting thousands of jobs it can survive consumers who are reluctant to spend and vendors less eager to give it credit.

But analysts say the moves announced Monday renewed the specter of bankruptcy hanging over the nation’s No. 2 consumer electronics retailer heading into a holiday shopping season that could determine its future.

“Clearly, (Circuit City) is frantically working to keep itself alive,” JP Morgan analyst Christopher Horvers wrote in a note to investors.

Circuit City Stores Inc. is closing 155 of its more than 700 U.S. stores by Dec. 31. The stores are spread throughout 28 states, including multiple locations in areas like Phoenix and Atlanta. It is laying off about 17 percent of its domestic work force, which could affect up to 7,300 people.

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