Leslie’s Pool Supply is facing renewed scrutiny over its financial position after closing about 80 stores, with Bloomberg reporting that the 63-year-old pool supplies retailer is considering a possible Chapter 11 filing as part of efforts to address its debt.

Retailers that sell discretionary or higher-cost products have been under pressure as consumers pull back on nonessential spending. Luxury shoppers’ confidence in the economy has continued to weaken amid global financial uncertainty and market volatility, according to the latest Saks Global Luxury Pulse survey.

“The survey, conducted between April 24 and April 28, found that only 28% of respondents reported feeling optimistic about the economy. That represents a 13 percentage point decline since the prior survey fielded in January, and a decline of 17 percentage points compared to last year,” the report said.

The weaker backdrop has added pressure for Leslie’s Pool Supply, which closed 80 locations in March. Bloomberg has reported that the company is now evaluating a possible Chapter 11 bankruptcy filing.

Leslie’s reported stronger second-quarter operating metrics

When Leslie’s reported second-quarter earnings in May, management pointed to improved operating results from the prior year.

“Compared to last year, in the second quarter, we delivered overall revenue growth of 4.3%, a comparable sales increase of 6.6%, improved year-over-year adjusted EBITDA by 26% and registered total customer count growth of 8%,” CEO Jason McDonell said during the company’s second-quarter earnings call.

Those results followed a series of reductions announced during the first quarter. Leslie’s said it would close approximately 80 underperforming stores as part of a cost-reduction and operational restructuring plan during Q1 fiscal 2026, according to its first-quarter earnings release.

The company also closed one distribution center in Illinois to streamline its supply chain and reduce expenses, according to the same Q1 filings. Leslie’s recorded approximately $10.1 million in non-cash impairment charges related to store and asset closures.

For Q1 fiscal 2026, Leslie’s reported a net loss of about $83 million and sales down roughly 16% year over year, citing weak demand and margin pressure in SEC filings.

After closing the stores, the chain has shifted more of its sales toward a digital model. In the second quarter, it reduced its loss from the first quarter, though losses were still higher than a year earlier.

“Net loss for the second quarter was $52.5 million compared with a net loss of $51.3 million in the second quarter of the prior year. Adjusted net loss in the second quarter was $50 million compared with an adjusted net loss of $48.3 million in the second quarter of the prior year,” CFO Jeffrey White said.

Bloomberg reports possible Chapter 11 discussions

Leslie’s executives did not mention a potential Chapter 11 filing during the company’s earnings call.

A Bloomberg report, citing unnamed “people familiar with the matter,” said Leslie’s is considering “a range of strategic options” to manage its debt load, including restructuring its debt through Chapter 11.

Chapter 11 is commonly used by companies seeking court-supervised protection while they attempt to reorganize liabilities or operations, and a filing does not necessarily mean a retailer will immediately shut down. In Leslie’s case, Bloomberg’s report framed the possible filing as one option under review as the company works through debt negotiations.

Bloomberg also reported that Leslie’s has a $756 million term loan due in 2028 that is being quoted at about 39 cents on the dollar.

According to Bloomberg’s sources, the talks are “ongoing” and “no final decision has been made.”

“Leslie’s reportedly brought on Centerview Partners LLC and Simpson Thacher & Bartlett to advise the company through the debt negotiations. A group of creditors hired Houlihan Lokey and Akin Gump Strauss Hauer & Feld,” the Phoenix Business Journal reported.

Leslie’s has faced pressure in public markets

Leslie’s Pools has also encountered financial pressure tied to its stock listing and market performance.

“The company’s stock performance has been under pressure throughout 2025, culminating in its removal from the S&P SmallCap 600 index earlier this year,” Pool Magazine, a publication covering the pool industry, reported.

The publication said the index removal reflected a loss of investor confidence.

“Being part of the S&P SmallCap 600 gives a company visibility, provides passive fund support, and signals investor confidence. Losing that standing means Leslie’s no longer met benchmarks for market cap and liquidity — a clear sign the stock has struggled to maintain momentum,” Pool Magazine added.

S&P Global Ratings downgraded the issuer credit rating of U.S. specialty pool supply retailer Leslie’s Poolmart Inc. from “B” to “B-” because of weaker-than-expected business prospects for fiscal 2025, according to Investing.com.

Together, the Bloomberg report, the debt trading level, the credit-rating downgrade and the company’s store-closure plan point to multiple pressure points for Leslie’s as it works to stabilize operations after a difficult first quarter.

This story was originally published by TheStreet on Jul. 26, 2026, where it first appeared in the Retail section.