The gourmet cupcake chain is reportedly closing all of its stores and could file for Chapter 7 bankruptcy protection. Fred Katayama reports.
Crumbs is crumbling. The gourmet bakery serving those four-inch calorie bombs is reportedly closing all of its stores. The move comes one week after the Nasdaq delisted its rapidly shrinking stock. Its shares had plummeted from $13 three years ago to 15 cents by then. The Wall Street Journal reports the company's options include filing for Chapter 7 bankruptcy liquidation. Crumbs spokesmen were unavailable for comment. The bakery featuring flavors like caramel macchiato and cookie dough grew from one location in New York in 2003 to 65 stores spanning 12 states and Washington as of March. Crumbs rode the wave of the cupcake craze spawned by Magnolia Bakery's cameo in the hit TV series "Sex and the City." The company expanded as if it were on a sugar high and went public eight years later. But its sales struggled recently so it began closing stores as it faced competition from the likes of Sprinkles, Gigi's Cupcakes and Magnolia, which has even spread afar as Beirut and Tokyo. It lost $15 million last year, and in the end, Crumbs couldn't afford the icing on the cupcake.