Fast food chain Wendy's is set to close hundreds of restaurants around the country.
CNN is reporting that in a call on Friday, Interim CEO Ken Cook told analysts a “mid single-digit percentage” of approximately 6,000 U.S. locations could close, which amounts to between 200 and 350 restaurants.
Cook said the closures will target "underperforming" locations in an effort to "boost sales and profitability."
“These actions will strengthen the system and enable franchisees to invest more capital and resources in their remaining restaurants,” Cook said. “Closures of underperforming units are expected to boost sales and profitability at nearby locations.”
Newsweek has contacted Wendy's for comment via email.
Why It Matters
The closures mark one of the largest cutbacks in Wendy’s history and highlight growing financial pressure on fast-food chains amid rising labor and food costs.
Shuttering up to 350 restaurants could lead to thousands of job losses and reduced competition in some local markets.
What To Know
The fast-food chain isn’t planning to close all of its struggling restaurants outright. Cook said the company aims to pinpoint underperforming locations and assess the best path forward for each. Instead of a one-size-fits-all strategy, Wendy’s will review individual stores to determine whether they can be improved or if shutting them down is the most viable option.
Wendy’s shut down 140 restaurants across the U.S. in 2024, though the company said at the time it planned to open new outlets in stronger markets.
The burger chain has lagged behind competitors in recent quarters. U.S. same-store sales dropped 4.7 percent, while McDonald’s, Burger King and Shake Shack all reported gains.
According to The Wall Street Journal, Wendy’s shares fell 2.6 percent on Friday and have plunged 46 percent so far this year. The company also reported quarterly net income of $44.3 million—down from $50.2 million a year ago.
However, Cook said there were reasons for optimism. The chain’s new chicken tenders, called “Tendys,” have proven unexpectedly popular. “We’re looking forward to continuing that momentum, and this is an encouraging first step as we look to reestablish our leadership position in chicken,” he added, noting that some stores ran out of the item before the marketing campaign even began.
www.newsweek.com
CNN is reporting that in a call on Friday, Interim CEO Ken Cook told analysts a “mid single-digit percentage” of approximately 6,000 U.S. locations could close, which amounts to between 200 and 350 restaurants.
Cook said the closures will target "underperforming" locations in an effort to "boost sales and profitability."
“These actions will strengthen the system and enable franchisees to invest more capital and resources in their remaining restaurants,” Cook said. “Closures of underperforming units are expected to boost sales and profitability at nearby locations.”
Newsweek has contacted Wendy's for comment via email.
Why It Matters
The closures mark one of the largest cutbacks in Wendy’s history and highlight growing financial pressure on fast-food chains amid rising labor and food costs.
Shuttering up to 350 restaurants could lead to thousands of job losses and reduced competition in some local markets.
What To Know
The fast-food chain isn’t planning to close all of its struggling restaurants outright. Cook said the company aims to pinpoint underperforming locations and assess the best path forward for each. Instead of a one-size-fits-all strategy, Wendy’s will review individual stores to determine whether they can be improved or if shutting them down is the most viable option.
Wendy’s shut down 140 restaurants across the U.S. in 2024, though the company said at the time it planned to open new outlets in stronger markets.
The burger chain has lagged behind competitors in recent quarters. U.S. same-store sales dropped 4.7 percent, while McDonald’s, Burger King and Shake Shack all reported gains.
According to The Wall Street Journal, Wendy’s shares fell 2.6 percent on Friday and have plunged 46 percent so far this year. The company also reported quarterly net income of $44.3 million—down from $50.2 million a year ago.
However, Cook said there were reasons for optimism. The chain’s new chicken tenders, called “Tendys,” have proven unexpectedly popular. “We’re looking forward to continuing that momentum, and this is an encouraging first step as we look to reestablish our leadership position in chicken,” he added, noting that some stores ran out of the item before the marketing campaign even began.
Wendy’s set to close hundreds of US restaurants: what we know
Fast food chain Wendy's is set to close hundreds of restaurants around the country.
www.newsweek.com