J.C. Penney announced Friday it would shutter as many as 140 stores over the next few months, amid sagging sales and fierce competition from online retailers.
The news comes on the heels of similar closures by Macy's and Sears, both of whom have been forced to cull their retail presence as evolving customer preferences favor clicks versus bricks.
"We believe closing stores will allow us to adjust our business to effectively compete against the growth threat of online retailers," J.C. Penney CEO Marvin Ellison told investors during a fourth-quarter earnings call on Friday.
Following the news, shares fell by around 4 percent as investors hedged their bets on a slim recovery by the once-iconic Main Street retailer.
"Although JCP ended its fiscal year with a shrink in sales, it can take some comfort from the fact that the decreases are modest and that it managed to outperform its main department store rivals," Neil Saunders, managing director of GlobalData Retail, told CNBC.
The full list of impacted stores will be available in March. Around 6,000 employees will be offered voluntary early retirement, Ellison said, noting that the cost cuts represent roughly $200 million.
The usually lucrative holiday period proved troublesome for many retailers this year, with sales at Penney's established stores down 0.7 percent. However, the company did turn a profit in 2016 for the first time since 2010 — notably due to "record" online sales, said Ellison.
