Is Wendy’s Bankrupted? As it Closes 140 restaurants

Wendy’s plans to close 140 U.S. restaurants before the end of this But in a conference call with investors Thursday, the company said those closures will be offset by new restaurant openings.

Wendy’s said it plans to open between 250 and 300 restaurants this year.Wendy’s plans to close 140 U.S. restaurants by year-end, adding to the 100 closures announced in May.

CEO Kirk Tanner stated these closures target underperforming locations that average $1.1 million in sales but have low profit margins.

Despite this, Wendy’s aims to open 250 to 300 new locations in better-performing areas, expecting net unit growth to remain stable.

Tanner emphasized a commitment to enhancing the brand’s presence and customer experience, with over 500 new openings planned over two years, reflecting a strategic shift towards modernization and profitability.

Which locations are most at risk of closing?

Wendy’s has not disclosed specific locations at risk of closing, but the 140 restaurants slated for closure are primarily those identified as underperforming in trade areas that do not support the brand’s growth.

CEO Kirk Tanner indicated these locations average $1.1 million in annual sales and have significantly lower profit margins than the chain’s average.

The closures are part of a strategy to replace outdated restaurants with new ones in more profitable areas, aiming for overall net unit growth to remain stable despite the closures.

Which other fast-food chains are planning to close locations?

Several fast-food chains are planning to close locations due to underperformance:- Denny’s: Plans to close 150 locations by the end of 2025, citing underperforming restaurants.

– Red Lobster: Filed for bankruptcy protection and has closed dozens of locations.

– 5GI Fridays: Closed 36 restaurants earlier this year, with more expected.

– Hooters: Shuttered about 40 locations across the U.S.

– MOD Pizza: Closed 27 restaurants in March 2024 due to similar reasons.

-Hardee’s, Cracker Barrel, and Applebee’s are also among chains that have announced closures this year.