A major women’s fashion retailer is closing 120 stores this year as shoppers feel the sting of higher prices

This year has seen a number of retailers deciding to close a significant number of stores.

As Fast Company reported last month, those closures have included hundreds of Eddie Bauer, Francesca’s, GameStop, and Walgreens locations. Now, another major retailer is joining that list.

The Cato Corporation, parent company of Cato Fashions, which operates more than 1,000 women’s apparel and accessories stores across 31 states, has announced it will close 120 of them—more than 10%—by the end of the year. Here’s what you need to know.

What is Cato?

The Cato Corporation is a company that owns and operates three different retailers that focus on fashion and apparel.

The company’s main brand is Cato (aka Cato Fashions), a women’s fashion retailer that operates in 30 states. Cato was founded in 1946, making the retailer 80 years old this year. As a value retailer, Cato focuses on price-conscious consumers. Its closest competitors are the likes of TJ Maxx.

The Cato Corporation also operates two other retailers. Versona is a boutique, upscale apparel, jewelry, and accessories brand with 90 locations in the U.S. It’s Fashion and It’s Fashion Metro are the company’s junior retailers, with 119 locations in the United States.

In total, the company’s stores cover 31 states. Its largest market is the southeastern United States.

The company is based in Charlotte, North Carolina, and is public, trading on the New York Stock Exchange under the ticker “CATO.”

What’s happened?

Last week, The Cato Corporation announced that it would close a total of 120 stores by the end of fiscal 2026. That is up from the 50 stores it initially said it would close in 2026.

In August, the company reported its Q2 results, which saw a net income of just $1.1 million—down significantly from the $6.8 million the company brought in the same period just a year earlier.

That net income decline was due to a decline in sales from $174.7 million in Q2 2025 to $163.9 million in this year’s Q2.

Announcing the disappointing results, the company’s CEO, John Cato, said they were “in large part due to the continued pressure on our customers’ discretionary income, which is being negatively impacted in part by persistent inflation, higher fuel prices and continued elevated interest rates.”

At the same time, the company said it had closed eight stores in the quarter. As of August 1, the company said it operated 1,057 stores in 31 states. That was down from the 1,101 stores it operated in 31 states in August of the year earlier.

Then, last week, the company announced that it would close a total of 120 stores this year, including 70 in the remaining two quarters.

“Annually we review approximately one-third of our stores to exercise available lease options or negotiate an extension based on each store’s performance including store sales trend and current and projected store profitability,” Cato explained. “In years past, marginal stores were renewed for an additional year to give the store more time to improve its sales trend and profitability.”

But this year, things are different.

“In light of the current economic environment, especially with the negative pressure on our customers’ discretionary income, we do not expect these marginal stores to improve appreciably,” Cato said. “As a result, we are closing more stores than expected this year.”

Which Cato stores are closing?

Despite confirming that it would now close a total of 120 stores during its current fiscal year, The Cato Corporation did not reveal the locations of the closing stores, or how many stores from each of its three primary brands would now be closing.

Fast Company has reached out to The Cato Corporation for comment.

How has Cato’s stock reacted?

Since announcing the additional store closures last Friday, CATO’s stock price has risen slightly, up about 2% in the past five trading sessions, according to Yahoo Finance data.

However, the company’s stock price has struggled this year. In January, the company’s shares opened at around $3.12. As of yesterday’s close, its share price was $2.43. That’s a roughly 21% decline since the year began.

But CATO’s shares have been hit hardest over the last month. Since announcing its Q2 results in August, the company’s share price has fallen almost 13% as of yesterday’s close.

At its current share price of $2.43, CATO stock is now hovering at lows not seen since the early 1990s.

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