Gibson Brands, the maker of some of the most iconic guitars in music history, has filed for bankruptcy citing “devastating” financial fallout from their ill-fated attempt to diversify into consumer electronics.
Even if you’re not a rock dog, you’ll definitely know Gibson guitars. The Les Paul stands alongside the Fender Stratocaster as the most recognisable electric guitar body in history, and other designs like the Flying V and the SG also occupy the imaginations of music fans the world over.
Gibson said in a statement accompanying their bankruptcy filing that they need court protection from creditors so they can reorganise the business and keep doing what they do best: making musical instruments. The company confirmed it has between $100M and $500M of debts, which is quite a lot.
Over the past few years, Gibson has attempted to capitalise on its name by diversifying into other areas adjacent to their musical instrument business, like manufacturing Gibson-branded speakers and headphones after acquiring Philips‘ audio division. This has not gone so well, and Gibson – despite producing some reasonably okay speakers – has failed to keep up with the rest of the audio industry.
They also attempted to innovate within their existing business to little success. If you’re a guitarist, you might recall their extremely controversial G Force self-tuning feature on their recent lines of guitars, which fans roundly rejected.
The electric guitar business is not going well overall. The shift in tastes among young people from guitar-driven rock and indie music to EDM and dance has hit the industry hard, and it’s been difficult to move product at the volumes they once did. Gibson’s annual revenue has dropped from $2.1 billion to $1.7 billion in 2017.
Tough times for a music icon. Let’s hope they pull through and get back to what they’re good at.
