Rite Aid will close all 178 of its remaining stores in New York as part of its second Chapter 11 bankruptcy, just months after exiting its first restructuring process. The closures, set to begin in early June, mark a significant retreat for one of the nation’s largest pharmacy chains.
CEO Jeffrey Stein acknowledged the upcoming closures and layoffs in a letter to employees, indicating that workers would begin losing their jobs as early as June 4th. He informed staff that payroll funding would run out before the final store closures. The New York State Department of Labor confirmed coordinating with Rite Aid to support affected employees.
The company, once a dominant player in retail pharmacy, has struggled with mounting debt, declining sales, and increasing legal liabilities. Rite Aid first filed for bankruptcy in October 2023, citing nearly $4 billion in debt, including lawsuits related to its alleged role in the opioid crisis. Though it emerged from bankruptcy in September 2024 after closing around 500 stores and slashing $2 billion in debt, it failed to stabilize its operations.
On Monday, May 5th, Rite Aid re-entered bankruptcy with $2 billion in new financing to remain operational as it seeks a buyer. Despite the ongoing closures, the company emphasized its intent to maintain pharmacy services during the transition. “While we have continued to face financial challenges, intensified by the rapidly evolving retail and healthcare landscapes in which we operate, we are encouraged by meaningful interest from a number of potential national and regional strategic acquirors,” CEO Matt Schroeder stated.
Rite Aid operates roughly 1,250 stores nationwide—about half the number it had two years ago. Its competitors, including Walgreens and CVS, have also faced declining prescription reimbursements and shifting consumer habits. Walgreens is preparing to go private after losing billions in market value, while CVS has closed over 1,000 stores and restructured operations.
With the New York market now slated for a complete exit, Rite Aid’s future remains uncertain as the company seeks buyers and trims its footprint further.
