Ikea makes major U.S. changes, closing stores

Core Insights - Ikea is closing its only store in Memphis, Tennessee, effective May 3, 2026, marking the end of its physical presence in the state since 2016 [4][5] - The closure is part of a broader strategic shift aimed at optimizing physical assets and enhancing e-commerce capabilities, with customers still able to access products online [5][10] - Ikea plans to invest over $2.2 billion in the U.S. over three years to expand its brand presence, including opening 14 new-format stores by 2025 [11] Company Background - Founded in 1943 by Ingvar Kamprad in Sweden, Ikea transitioned to furniture in 1948 and has since grown to operate over 500 stores in 63 markets globally [2] - Known for affordability and minimalist designs, Ikea has become a popular choice for budget-conscious consumers [3] Recent Developments - The decision to close the Memphis store followed a comprehensive review of market share, business performance, and cost structure [5] - Employees affected by the closure will have opportunities to transfer to other locations or receive severance [6] - The Memphis store closure is part of a trend, as Ikea has also shut down several small-format "Plan & Order Point" locations recently [8] Financial Performance - In fiscal year 2025, Ikea reported a nearly 0.9% year-over-year decline in total revenues, with retail sales down 1.1%, attributed to price reductions [12] - Despite the revenue decline, sales volume increased by 2.6% and store visits rose by 1.9%, indicating resilient consumer demand [12] - Approximately 69% of products were sold in physical stores, highlighting the importance of brick-and-mortar locations [13] Industry Context - The retail environment is challenging, with store closures in 2025 up 67% year-over-year, reflecting broader trends in the sector [15] - The impact of widespread store closures can lead to reduced convenience for consumers and potential 'retail deserts' in smaller towns [17]