HMV has confirmed it is to call in administrators after being battered by "extremely weak" Christmas trading on the high street and a collapse in demand for CDs and DVDs.
It will be the second time in six years that the retailer, which employs about 2,200 people, has fallen into administration.
A statement from the company – confirming a story first reported by Sky News – pointed to a "tsunami of challenges" facing UK retailers.
It said its 125 UK stores would continue to trade as it held talks with major suppliers in the entertainment industry – with record labels keen to avert the disappearance of the last major specialist music retailer on the high street.
The company added that buyers were also being sought to take over the business.
HMV – short for "his master's voice" – dates back to 1921 when its first store on London's Oxford Street was officially opened by the composer Sir Edward Elgar.
The company said it had "resolved to appoint administrators from KPMG" after "extremely weak Christmas footfall and a deterioration in the UK market for CD and DVD".
Executive chairman Paul McGowan said consumers had switched "at an ever increasing pace" to digital downloads instead.
HMV previously fell into administration in January 2013 before being acquired by present owner Hilco in a £50m deal.
Mr McGowan said efforts had been made to drive down costs through agreements with landlords and the use of technology.
"However, during the key Christmas trading period the market for DVD fell by over 30% compared to the previous year and, whilst HMV performed considerably better than that, such a deterioration in a key sector of the market is unsustainable," he added.
Mr McGowan said the business had also suffered from the "general malaise" affecting the high street, pointing in particular to its annual business rates bill of more than £15m.
"Even an exceptionally well-run and much-loved business such as HMV cannot withstand the tsunami of challenges facing UK retailers over the last 12 months on top of such a dramatic change in consumer behaviour in the entertainment market."
HMV said it sold 31% of all physical music in the UK and 23% of all DVD and Blu-ray and that its market share had grown month by month throughout the year.
However, it added that industry consensus was that the market as a whole would fall by another 17% during 2019.
"As a result the directors have concluded that it will not be possible to continue to trade the business."
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The announcement comes amid expectations of a tough end of year trading period for the retail sector – with Sports Direct and House of Fraser boss Mike Ashley describing conditions in November as "the worst in living memory" and that struggling chains faced being smashed "to pieces".
Meanwhile budget womenswear chain Bonmarché said conditions were unprecedented and worse than during the recession, while Primark and Superdry also flagged tough high street conditions and even online retailer Asos has not been immune, issuing a profits warning.
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