America’s restaurant industry continues to evolve in 2026, with several well-known chains closing underperforming locations as they respond to changing consumer habits, rising operating costs and softer sales.
While many of these companies are still opening restaurants in select markets, they’re also trimming older or less profitable locations in an effort to strengthen long-term performance. Here are 10 of the biggest chains shrinking their footprints this year.
1. Applebee’s
Parent company Dine Brands expects a net reduction of 20 to 35 Applebee’s restaurants this year while investing in new dual-branded Applebee’s-IHOP locations.
2. Red Lobster
Following its bankruptcy, Red Lobster continues closing restaurants while remodeling select locations under its new “new-stalgia” strategy.
3. Denny’s
The diner chain continues its multiyear plan to eliminate older, underperforming restaurants after announcing plans to close up to 150 locations.
4. Red Robin
Red Robin is evaluating up to 50 restaurants for closure as part of a broader debt-reduction and turnaround plan.
5. Wendy’s
The burger chain has continued pruning lower-performing restaurants while focusing on new development and higher-volume markets.
6. Papa Johns
Papa Johns is closing underperforming restaurants while emphasizing international expansion and stronger franchise performance.
7. Pizza Hut
Pizza Hut is reducing its U.S. footprint by closing lower-performing restaurants as it modernizes its system.
8. Jack in the Box
The chain continues to streamline its portfolio by exiting weaker locations while investing in long-term growth opportunities.
9. Noodles & Company
The fast-casual brand plans additional restaurant closures after several years of declining traffic and profitability challenges.
10. TGI Fridays
The casual dining chain continues shrinking following its restructuring, with dozens of additional restaurant closures announced this year.
Bottom line
Although restaurant closures often grab headlines, they don’t necessarily signal the end of a brand. Many chains are simultaneously investing in remodels, smaller restaurant formats, digital ordering and franchise development. Still, the growing list of closures illustrates how operators are adapting to higher labor and food costs, shifting consumer spending and increased competition as the restaurant industry continues to reset in 2026.
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