Saks CEO Steps Down Amid Crushing Company Debt

Saks Global Enterprises, the parent company of luxury retail giants Saks Fifth Avenue and Neiman Marcus, announced on Friday that CEO Marc Metrick has stepped down effectively immediately. The sudden leadership change comes as the company navigates a period of significant financial turbulence, grappling with a massive debt load following its recent acquisition of rival Neiman Marcus and a contracting global luxury market.

Leadership Shakeup at the Top For Saks

The departure of Metrick marks the end of a decades-long tenure with the brand. Having joined Saks Fifth Avenue in 1995, Metrick rose through the ranks to hold various leadership positions at both Saks and its former parent company, Hudson’s Bay Co. He was appointed CEO of Saks Fifth Avenue in 2021 and subsequently took the helm of the newly formed Saks Global in 2024 following the acquisition of Neiman Marcus.

In a statement regarding the leadership transition, the company announced that Metrick is leaving to “pursue new opportunities.” Stepping into the role to guide the retailer through this critical juncture is Richard Baker, the company’s Executive Chairman. Baker will now serve in a dual capacity, taking on the CEO responsibilities while retaining his chairmanship. This consolidation of power suggests a strategic move to streamline decision-making as the company attempts to stabilize its operations.

The Burden of Billion-Dollar Debt

At the heart of Saks Global’s current struggles is the financial aftermath of its ambitious expansion. In the summer of 2024, the company finalized a blockbuster $2.65 billion acquisition of Neiman Marcus. While the deal was designed to consolidate power in the luxury sector and create a dominant retail empire, it has left the combined entity saddled with substantial debt.

The financial strain has been palpable. In August, just months after the merger, Saks Global completed a $600 million notes offering. This move was widely interpreted by financial analysts as a necessary step to bolster liquidity and ensure the company had the cash flow required to manage its day-to-day operations and service its mounting obligations. The challenge of integrating two massive retail infrastructures while managing the debt incurred from the purchase has proven to be a formidable task, one that will now fall squarely on Baker’s shoulders.

A Cooling Luxury Market

Compounding the internal financial pressures is an increasingly hostile external environment. The luxury retail sector, once thought to be recession-proof, is showing cracks. According to a November study released by Bain & Co., global sales of personal luxury goods are expected to contract for the second consecutive year in 2026.

Several factors are driving this downturn:

• Price Sensitivity: Wealthier consumers, who traditionally drive the sector’s profits, have begun to rebel against what they perceive as “extravagant” price hikes. Brands that have raised prices without delivering commensurate value or excitement are seeing their clientele pull back.
• Economic Anxiety: Growing uncertainty about the global economy has led even affluent shoppers to tighten their purse strings.
• Fragmenting Competition: The landscape is becoming more crowded and fragmented, with consumers having more choices than ever, diluting the market share of legacy department stores like Saks and Neiman Marcus.

The Evolution of Saks Global

The corporate structure of Saks has undergone significant changes in recent years. Hudson’s Bay Co., the Canadian owner of Saks Fifth Avenue, made the strategic decision to split off the luxury retailer’s e-commerce business, Saks.com, into a separate entity in 2021. This move was intended to unlock value and attract tech-focused investors.

However, the subsequent reunification of operations under the “Saks Global” banner following the Neiman Marcus acquisition in 2024 signaled a pivot back toward a consolidated model. The goal was to create a unified powerhouse capable of leveraging efficiencies across both the brick-and-mortar and digital realms. Unfortunately, the synergy expected from the merger has been overshadowed by the immediate pressures of debt servicing and a softening market.

What Lies Ahead?

As Richard Baker takes the reins, the path forward for Saks Global remains fraught with challenges. The immediate priority will likely be debt management and finding ways to reignite growth in a sluggish market. The company must find a way to win back cost-conscious luxury consumers while differentiating itself in a crowded marketplace.

For the retail industry, Metrick’s departure serves as a stark reminder of the volatility facing even the most established names in luxury. As Saks Global attempts to right the ship, industry observers will be watching closely to see if the conglomerate can leverage its massive footprint to survive the current storm or if further restructuring will be necessary to ensure its long-term viability.