Leslie’s Pool Supply: A Luxury Retailer’s Struggle to Stay Afloat

When a retailer sells a product that people no longer want or need at the same level they once did, it becomes challenging for that retailer to operate.

That’s the situation facing Leslie’s Pool Supply, a 63-year-old luxury retailer that has been struggling to stay afloat in the current economic climate.

Leslie’s Closes 80 Stores and Faces Financial Struggles

In March, Leslie’s Pool Supply closed 80 underperforming stores as part of a cost-reduction and operational restructuring plan.

The company also closed one distribution center in Illinois to streamline its supply chain and reduce expenses.

Despite these efforts, Leslie’s reported a net loss of about $83 million for Q1 fiscal 2026, citing weak demand and margin pressure.

Leslie’s Seeks to Restructure Debt Through Chapter 11

Bloomberg reported that Leslie’s is looking at ‘a range of strategic options’ to address its debt load, including restructuring its debt through Chapter 11.

The company has a $756 million term loan due in 2028, which is being quoted at about 39 cents on the dollar.

Leslie’s has 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.

Leslie’s Struggles to Maintain Momentum

Leslie’s stock performance has been under pressure throughout 2025, culminating in its removal from the S&P SmallCap 600 index earlier this year.

This is a clear sign that investors have lost confidence in the company.

S&P Global Ratings has downgraded the issuer credit rating of U.S. specialty pool supply retailer Leslie’s Poolmart Inc. from ‘B’ to ‘B-‘ due to weaker-than-expected business prospects for fiscal 2025.

Leslie’s has struggled to maintain momentum, with its stock no longer meeting the benchmarks for market cap and liquidity.

Q2 Results Show Improvement, but Chapter 11 Looms

Leslie’s reported positive Q2 results, with revenue growth of 4.3% and comparable sales increase of 6.6%.

The company also improved year-over-year adjusted EBITDA by 26% and registered total customer count growth of 8%.

However, the company’s net loss for the second quarter was $52.5 million, compared to 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 to an adjusted net loss of $48.3 million in the second quarter of the prior year.