Ikea makes major U.S. changes, closing stores

Many people remember furnishing their first apartment, an exciting milestone often challenged by a tight, entry-level budget fresh out of college. Some hunted for bargains on Facebook Marketplace or graciously accepted hand-me-down décor from friends and family. Others turned to one dependable retailer that seemed to meet every decorating need without draining their bank accounts.For several budget-conscious shoppers, that retailer was Ikea.While today Ikea is known for its furniture and Swedish meatballs, the company began in 1943 as a business selling pens and wallets, founded by 17-year-old Ingvar Kamprad in Älmhult, Sweden. Ikea transitioned to furniture in 1948, a move that would make it the global brand it is today and lead it to operate more than 500 stores across 63 markets worldwide.Known for its affordability, minimalist designs, and compact convenience, Ikea became a go-to for small apartments and starter homes alike. Now, the company is preparing to leave a community without its only physical store and has not indicated plans to return anytime soon.Ikea is closing its only Memphis locationIkea confirmed it will close its Memphis store at 7900 Ikea WayCordova, Tennessee, on May 3, 2026, eliminating the company's sole brick-and-mortar presence in the state, where it has operated since 2016, according to its store locator."The decision to close the Memphis store was made following a comprehensive review, and considering several factors including market share, business performance, cost structure, and overall optimization of physical assets," said Ikea in a company press release.While the physical location will shut down, Memphis-area customers will continue to have access to Ikea products through the company's e-commerce platform. Home delivery services and FedEx pickup points in the Cordova area will remain available. Employees impacted by the closure will be offered opportunities to transfer to other Ikea locations, and those who choose not to relocate will receive severance, according to the company. This decision comes less than a year after Ikea completed a full renovation of the Memphis store in 2025, redesigning the layout as part of a broader effort to modernize its U.S. footprint and better serve the local community."We've been enhancing store formats to increase convenience, make delivery more affordable, and connect with customers where they live, work, and socialize," said Ikea U.S. CEO and Chief Sustainability Officer Javier Quiñones in a company press release at the time. "Ikea Memphis marks a key milestone in our journey towards a more connected and accessible Ikea experience for all." Ikea confirms the closure of its only Tennessee store.Shutterstock Ikea shutters locations nationwideThe Memphis closure is not a one-off move. Ikea has also shuttered several small-format "Plan & Order Point" locations over the past year.Ikea store closuresArlington, Virginia (Pentagon City): Closed November 2025, reported The Washington Business Journal.Alpharetta, Georgia: Closed August 2025, according to Atlanta Tomorrow's News Today.Long Beach, California: Closed June 2025, per The Street.Southlake, Texas: Closed February 2026, Community Impact reported.Ikea reveals its new growth strategyThese closures are part of what the company describes as "part of a strategic shift to build a more affordable, accessible, and sustainable future." That approach includes opening new locations, upgrading existing stores, expanding digital capabilities, and strengthening delivery and pickup services while closing stores that no longer align with its long-term goals.More Retail Store Closures:159-year-old retail giant announces more store closures62-year-old retail chain gets lifeline after store closuresFormerly bankrupt retail chain announces new round of closuresIn 2023, Ikea announced plans to invest more than $2.2 billion in the U.S. over three years to expand its brand presence and accessibility by opening 14 new-format stores in 2025 and additional locations in 2026, alongside improvements to logistics and e-commerce infrastructure.Ikea faces financial pressures and industry trendsIn Ikea's full fiscal year 2025 earnings report, total revenues fell nearly 0.9% year over year, with retail sales down 1.1%. The company attributed the decrease to price reductions introduced in 2024, which lowered profit margins while preserving affordability.Despite the dips, sales volume increased 2.6% and store visits rose 1.9%, indicating consumer demand remained resilient. Approximately 69% of products were sold in physical stores, while 28% were purchased online, which highlights the continued importance of Ikea's brick-and-mortar locations.In the second half of the fiscal year, uncertainty surrounding U.S. tariffs led to higher commodity prices and sourcing costs. However, overall purchase price levels stabilized by the end of 2025, allowing Inter Ikea Group to maintain wholesale pricing for franchise retailers.Ikea operates under two entities: Inter Ikea Group oversees product supply and services, while Ikea franchisees, comprising 13 groups across seven countries as of November 2025, manage retail operations.A challenging retail environmentIkea's restructuring reflects broader challenges across the retail sector. Store closures announced in 2025 were up 67% year over year, according to CoreSight Research."Vacant storefronts are becoming an increasingly common sight, and declining commercial property values are the norm," said Approved Funding President and Chief Lending Officer Shmuel Shayowitz. "For consumers, the fallout means fewer choices, diminished access to in-person shopping, and, in some cases, higher prices due to reduced competition."Retail analysts warn that continued closures can have major consequences across communities."For shoppers, widespread store closures can reduce convenience, especially in smaller towns, said Retail Insights Network Financial Reporter Mohamed Dabo. "In the U.S., location losses may even create 'retail deserts' where travel of up to 20 miles becomes necessary for everyday shopping."Industry experts also highlighted the broader implications closures can have in an already fragile economy."The widespread closures of physical retail stores in the digital age significantly impact business outcomes, urban communities, and regional economies," said industry experts at ScienceDirect. "Understanding this phenomenon is crucial for retailers, policymakers, and society at large."The U.S. Bureau of Labor Statistics’ Employment Situation update showed that the unemployment rate stood at 4.4% in December 2025, representing approximately 7.5 million unemployed Americans.Related: Global toy retailer suspends online operations, closes stores