For decades, Red Lobster was one of America’s most recognizable casual dining chains, known for Cheddar Bay Biscuits, seafood platters, and its wildly popular Endless Shrimp promotion. But after filing for bankruptcy in 2024 and closing more than 100 restaurants, the seafood giant is still shrinking in 2026 as it struggles to complete a long-term turnaround.
Red Lobster continues closing restaurants in 2026
Red Lobster has continued shutting down underperforming restaurants this year as executives reevaluate the chain’s footprint following its Chapter 11 bankruptcy restructuring. CEO Damola Adamolekun has acknowledged that additional closures may still be necessary to stabilize the company and reduce costs.
Several closures have already occurred in 2026. In March, a Red Lobster location in Bangor Township, Michigan permanently closed after serving customers for years. Around the same time, the chain also shut down its restaurant at Cielo Vista Mall in El Paso, Texas after its lease expired.
More recently, a longtime Red Lobster in Dickson City near Scranton, Pennsylvania closed in April after roughly 25 years in business. Local officials described the restaurant as one of the community’s longstanding dining staples.
The chain now operates roughly 515 to 545 locations nationwide, down sharply from more than 640 restaurants before bankruptcy.
How Red Lobster ended up in bankruptcy
Red Lobster filed for Chapter 11 bankruptcy protection in May 2024 after years of financial struggles tied to rising labor costs, expensive leases, declining traffic, and mounting debt. Reports indicated the company had accumulated hundreds of millions in debt before restructuring.
The company’s troubles were also linked to its controversial Endless Shrimp promotion, which reportedly generated massive losses after being expanded into a permanent menu offering in 2023. The promotion became widely associated with the chain’s collapse after executives revealed it contributed to major quarterly losses.
During bankruptcy proceedings, Red Lobster abruptly closed around 130 restaurants across the country.
A difficult recovery effort
The company officially exited bankruptcy in late 2024 under new ownership and has since attempted to rebuild the brand through menu changes, restaurant remodels, and new promotions.
Even with some signs of improvement, Red Lobster continues to face pressure from rising seafood costs, changing consumer habits, and ongoing competition in the casual dining industry.
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