It is the end of an era for one of the most powerful brands of the cable TV generation.
On Wednesday, April 15, the owner of home shopping network giant QVC, QVC Group, announced that it is planning to file for Chapter 11 bankruptcy protection.
The company, which is also the parent company for HSN (formerly the Home Shopping Network) disclosed the plan in a filing with the Securities and Exchange Commission. Here’s what we know.
The filing
“As of the Petition Date, we intend to operate our businesses as a debtor-in-possession under the jurisdiction of the Bankruptcy Court in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court,” QVC Group’s filing stated.
It added: “QVC Group and QVC, Inc. intend to request approval from the Bankruptcy Court for a variety of ‘first day’ motions to continue our ordinary course operations during the Chapter 11 Cases. Although no assurance can be made as to a potential emergence date, QVC Group is targeting emergence from the Chapter 11 Cases within approximately 90 days.”
© Getty ImagesWhat’s next
The specifics around the bankruptcy remain to be determined, though Chapter 11 allows a company to continue operating while it is restructured.
ABC News reports that the company’s goal is to emerge from bankruptcy protection before the summer is over, however it warned that its access to funding is difficult to predict, noting significant fees and other costs in connection with the preparation for the bankruptcy protection.
“Even if the Plan is consummated, we may not be able to achieve our stated goals and continue as a going concern,” the filing further stated. It notes that the occurrence of circumstances such as being unable to retain key executives and employees, employees being attracted to other employment opportunities, and competitors possibly taking business away from them as potentially having “a material and adverse effect on our operations, financial condition and reputation.
It maintained: “We cannot assure you that having been subject to bankruptcy proceedings will not adversely affect our operations in the future. As a result of these and other risks, we cannot guarantee that the Plan will achieve our stated goals.”
A shift in shopping
This filing comes one year after QVC Group laid off 900 employees in an effort to consolidate its operations, amid an ever-changing shopping landscape, which has seen them shift towards live shopping on social platforms like TikTok, Gen Z’s preferred platform for that kind of content.
“Linear TV is a highly engaging, highly profitable platform and it remains our cornerstone. However, as traditional TV declines and a mix of video platforms takes a greater share of customer attention, we must hurry our expansion beyond TV to find growth,” the company said at the time.
© Getty ImagesQVC’s beginnings
QVC, which is short for Quality Value Convenience, was founded by Joseph Myron Segel in West Chester, Pennsylvania in 1986; he passed away aged 88 in 2019.
By 1993 it was helmed by media tycoon Barry Diller, who was introduced to the network by his wife, fashion designer Diane von Fürstenberg. Under his leadership, its company name was changed from QVC Network to QVC, Inc., and he also added new divisions, Q Direct, which produced infomercials and 60- and 120-second direct response TV commercials, and QVC Interactive, an online-shopping service.
It was purchased by cable mogul John Malone for $7.9 billion in 2003. QVC reached its highest annual revenue in 2020, with approximately $14 billion in sales, however sales were down 30% by 2024. Per ABC News, shares in QVC Group went for over $900 a decade ago, but were trading for less than $3 earlier this week.
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