Is your favorite burger chain on the chopping block? See why 70 locations might shut down!
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As the sun sets on some familiar red and yellow signs, patrons across the country are left wondering: will my local gourmet burger joint be next?
A beloved chain known for its juicy burgers and bottomless fries is facing a tough decision that could see around 70 of its underperforming locations close their doors in an effort to manage debt and streamline operations.
Who’s next on the line of fast food chains saying goodbye?
Red Robin’s financial health has been under scrutiny, with total revenues for 2024 dipping to $1.25 billion—a noticeable decrease of $54.5 million from the previous year.
The net loss also widened significantly, from $21.2 million in 2023 to a staggering $77.5 million in 2024. These figures, released in a February earnings statement, paint a picture of a brand in the midst of a challenging period.
In response to these financial pressures, Red Robin has already begun to take action. Last year, the chain closed a location following the expiration of its lease.
Now, the company is “evaluating alternatives for approximately 70 underperforming restaurant locations,” which may include closures as current lease terms come to an end.
G.J. Hart, the president and CEO of Red Robin, has indicated that most of these closures are expected to occur over the next five years, with 10 to 15 restaurants slated to shut down in 2025 alone.
Despite these setbacks, Hart remains optimistic, stating, “While financial results for 2024 fell well below our original expectations, we've made substantial improvements to the guest experience and believe we still have a significant opportunity ahead of us to reach the full potential of our iconic brand.”
So, what's on the menu for Red Robin's recovery plan? Hart has outlined a strategy focused on enticing guests back into the restaurants with “craveable food,” enhancing operational efficiency, and boosting profitability at both the restaurant and corporate levels.
The introduction of new menu items and promotions throughout 2025, including limited-time offers and fresh salad options, is expected to play a crucial role in rekindling customer interest.
Hart is confident that the momentum gained at the end of the fourth quarter will carry into the new year, stating, “2025 is off to a good start with the comparable restaurant revenue momentum we had exiting the fourth quarter, continuing through the first eight weeks of the first quarter.”
He believes that the company's strategy positions them to 'deliver significant value to our guests and shareholders alike.”
Despite the closures, Red Robin's more than 300 company-owned locations are still performing well, with a reported gain in sales.
As of the end of the 2024 fiscal year, there were 498 Red Robin restaurants, with 407 owned by the company and 91 operated by franchisees.
The anticipated closures are not just about cutting losses–they're also about strengthening Red Robin's portfolio and freeing up capital for reinvestment or debt repayment.
Hart has hinted at exploring additional avenues to accelerate this process and promises updates in the near future.
Red Robin isn't alone in its strategic retreat. Other dining giants like Denny's and Wendy's have also announced closures of underperforming locations.
Denny's plans to close down 70 to 90 restaurants in 2025, following the closure of 88 locations the previous year. Wendy's, too, closed 276 locations last year, as reported by Restaurant Dive.
Recommended for you: Burger lovers, beware! Is your favorite burger place closing?
Robert Verostek, Denny's chief financial officer, explained that for mature brands, it's natural for trade areas to shift over time.
“Accelerating the closure of lower-volume restaurants will improve franchisee cash flow and allow them to reinvest into traffic-driving initiatives,” he said during an investors call.
While the news of potential closures may be disheartening for Red Robin enthusiasts, it's important to remember that this is a strategic move aimed at ensuring the long-term success and sustainability of the brand.
By focusing on their strongest locations and improving the overall customer experience, Red Robin hopes to emerge from this period stronger and more competitive.
Also read: This popular sandwich chain is closing for good—don’t miss out
Have you noticed changes at your local Red Robin or another favorite dining establishment? How do you feel about the potential closures? Share your thoughts and experiences with us in the comments below!
A beloved chain known for its juicy burgers and bottomless fries is facing a tough decision that could see around 70 of its underperforming locations close their doors in an effort to manage debt and streamline operations.
Who’s next on the line of fast food chains saying goodbye?
Red Robin’s financial health has been under scrutiny, with total revenues for 2024 dipping to $1.25 billion—a noticeable decrease of $54.5 million from the previous year.
The net loss also widened significantly, from $21.2 million in 2023 to a staggering $77.5 million in 2024. These figures, released in a February earnings statement, paint a picture of a brand in the midst of a challenging period.
In response to these financial pressures, Red Robin has already begun to take action. Last year, the chain closed a location following the expiration of its lease.
Now, the company is “evaluating alternatives for approximately 70 underperforming restaurant locations,” which may include closures as current lease terms come to an end.
Red Robin Gourmet Burgers, Inc. is considering the closure of approximately 70 underperforming restaurant locations in an effort to manage debt. Image source: TD3 / Youtube.
G.J. Hart, the president and CEO of Red Robin, has indicated that most of these closures are expected to occur over the next five years, with 10 to 15 restaurants slated to shut down in 2025 alone.
Despite these setbacks, Hart remains optimistic, stating, “While financial results for 2024 fell well below our original expectations, we've made substantial improvements to the guest experience and believe we still have a significant opportunity ahead of us to reach the full potential of our iconic brand.”
So, what's on the menu for Red Robin's recovery plan? Hart has outlined a strategy focused on enticing guests back into the restaurants with “craveable food,” enhancing operational efficiency, and boosting profitability at both the restaurant and corporate levels.
The introduction of new menu items and promotions throughout 2025, including limited-time offers and fresh salad options, is expected to play a crucial role in rekindling customer interest.
Hart is confident that the momentum gained at the end of the fourth quarter will carry into the new year, stating, “2025 is off to a good start with the comparable restaurant revenue momentum we had exiting the fourth quarter, continuing through the first eight weeks of the first quarter.”
He believes that the company's strategy positions them to 'deliver significant value to our guests and shareholders alike.”
Despite the closures, Red Robin's more than 300 company-owned locations are still performing well, with a reported gain in sales.
As of the end of the 2024 fiscal year, there were 498 Red Robin restaurants, with 407 owned by the company and 91 operated by franchisees.
The company's total revenue for 2024 was down, and they suffered a substantial net loss compared to the previous year. Image source: KPAX-TV / Youtube.
The anticipated closures are not just about cutting losses–they're also about strengthening Red Robin's portfolio and freeing up capital for reinvestment or debt repayment.
Hart has hinted at exploring additional avenues to accelerate this process and promises updates in the near future.
Red Robin isn't alone in its strategic retreat. Other dining giants like Denny's and Wendy's have also announced closures of underperforming locations.
Denny's plans to close down 70 to 90 restaurants in 2025, following the closure of 88 locations the previous year. Wendy's, too, closed 276 locations last year, as reported by Restaurant Dive.
Recommended for you: Burger lovers, beware! Is your favorite burger place closing?
Robert Verostek, Denny's chief financial officer, explained that for mature brands, it's natural for trade areas to shift over time.
“Accelerating the closure of lower-volume restaurants will improve franchisee cash flow and allow them to reinvest into traffic-driving initiatives,” he said during an investors call.
While the news of potential closures may be disheartening for Red Robin enthusiasts, it's important to remember that this is a strategic move aimed at ensuring the long-term success and sustainability of the brand.
By focusing on their strongest locations and improving the overall customer experience, Red Robin hopes to emerge from this period stronger and more competitive.
Also read: This popular sandwich chain is closing for good—don’t miss out
Have you noticed changes at your local Red Robin or another favorite dining establishment? How do you feel about the potential closures? Share your thoughts and experiences with us in the comments below!
