With many of the same macroeconomic conditions from 2025 continuing this year, restaurants have had a tough time increasing traffic and sales. Some chains, like McDonald’s, Chili’s and Taco Bell, have made significant gains in improving their value perceptions and seeing subsequent sales drivers. But some are facing tough decisions and have to purge hundreds of underperforming units from their systems.
These units typically drive down results for the entire system, and closures often lead to higher sales at nearby restaurants as consumers move to the remaining open locations. Closures also leave opportunities for high-growth brands to turnover these locations quicker and at a lower cost than a ground-up development. Dine Brands, for example, sees significant potential in converting closed restaurants into IHOPs.
So far in 2026 several publicly traded chains, including Wendy’s, Papa Johns and Pizza Hut, have announced major closures as part of their plans to improve profitability and their overall system.
It’s not just high-profile brands that expect to close this year. Closures are expected throughout the industry this year, and Black Box Intelligence said that 9% of full-service restaurants and 4% of limited-service restaurants were at risk of closure this year.
Check out six brands that plan closures this year.
Wendy’s
Expected closures: Roughly 300 to 350 units
The company is working on improving franchisee economics and will close underperforming stores to allow franchisees “to increase focus on locations with the greatest for portable growth,” Ken Cook, CFO and interim CEO said during the Q4 earnings call. The company evaluated restaurants on a store-by-store basis and expects 5% to 6% of its U.S. restaurants to close. Based on Wendy’s Q4 U.S. restaurant total of 5,969, about 300 or more restaurants will close.
During the fourth quarter, Wendy’s closed 28 units, with the remaining units to close during the first half of the year. The chain is still opening new units, however, and opened 109 restaurants last year for a net total of 36 new units, according to an earnings release.
Papa Johns
Expected closures: 300
The pizza chain performed a strategic review of its restaurant fleet, assessing the quality of operations, trade zones and assets to determine which restaurants should close. These restaurants, most of which are franchised, are over a decade old, have an average unit volume under $600,000 and typically have a negative four-wall income. They also don’t meet brand expectations and don’t have a path to sustainable growth.
Papa Johns, which worked closely with franchisees during its evaluation, plans to close most of these stores by the end of 2027, with about 200 on the chopping block this year.
Pizza Hut
Expected closures: 250
Parent company Yum Brands has been undertaking a strategic review of Pizza Hut since last year, with the possibility that it could sell the chain, which has had several quarters of same-store sales declines. Following the review, Yum determined that it would close underperforming stores as part of its “Hut Forward” turnaround plan, which also includes marketing, modernizing technology and franchise agreements, and Yum offering a one-time contribution to help with marketing.
These restaurants are expected to close during the first half of this year.
Jack in the Box
Expected closures: 50 to 100
Closures are part of the chain’s Jack on Track turnaround strategy, which is meant to improve the company’s balance sheet. During fiscal Q4 2025, the chain shuttered 47 units, of which 38 were related to its turnaround strategy, according to an earnings release. During the fiscal year, Jack opened 31 restaurants, but closed 86, dropping its franchised store count below 2,000 units. Restaurants nearby closed units are seeing a roughly 30% sales lift, CFO Dawn Hooper said during an earnings call.
The chain is also working on light-touch reimaging, including fresh paint, restriping and sealing parking lots and touching up landscaping at remaining locations.
Noodles & Company
Expected closures: 30 to 35
Noodles & Company has been optimizing its portfolio since 2024, and closed 33 company-owned restaurants and nine franchise restaurants in 2025, according to a preliminary release of its Q4 results. In 2024, the chain closed 20 company-owned restaurants. The company had about 340 restaurants as of Dec. 30, 2025.
The brand expects to keep about 30% of sales, thanks to traffic diversion to nearby restaurants, which “improve[s] overall sales leverage and enhance[s] restaurant level profitability and efficiency,” Noodles CEO and President Joseph Christina said during a November earnings call.
“The closures removed restaurants with negative cash flow from our system and post-closure, we're seeing nearby Noodles restaurants experience an increase in sales and profits,” he said.
Bahama Breeze
Expected closures: 14
Parent company Darden will wind down its Bahama Breeze operations this year after performing a strategic review of the casual chain’s brand positioning and strategic potential. While it considered selling the brand, Darden ultimately decided to close 14 units and convert another 14 to different Darden brands. Restaurants will close by April 15 with the remaining converted over the next 12 to 18 months. Darden previously closed 15 Bahama Breeze units last year.
Correction: A previous version of this article misidentified Wendy’s interim CEO. Ken Cook is Wendy’s CFO and interim CEO.
