Denny’s closing restaurants: 30 more locations added to doomed list as struggling diner fights inflation

Denny’s Corporation (NASDAQ: DENN) told investors it is closing another 30 restaurants, for a total of 180 closures combined in 2024 and 2025, while reporting fourth-quarter earnings on Wednesday. (It had previously said it would close a total of 150 locations.) The move is part of the restaurant chain’s plan to jumpstart its waning growth.

Denny’s, like many fast-food and casual-dining chains, has been struggling in recent years due to inflation, changing customer habits, and skyrocketing food prices. It’s just one of many major chains to announce store closures recently, a list that includes TGI Fridays, Shake Shack, and Wendy’s as well. But Denny’s told Fast Company that, regarding the restaurants that will be closing, it is “unable to provide specific location information at this time.”

Shares of Denny’s were down nearly 2% in midday trading Thursday and closed nearly 25% lower yesterday after it missed earnings expectations. Denny’s reported operating revenue of $114.7 million, down from $115.4 million last quarter; $52.4 million in sales, down from $54.0 million last quarter, and a net income of $6.8 million. Overall, Denny’s stock is down about 50% since a year ago.

In its fourth-quarter-earnings release, the Spartanburg, South Carolina-based company said it closed 88 locations in 2024 and will shut another 70 to 90 locations in 2025. According to the company, many of the locations marked for closure are less profitable, have leases that are expiring, or are too old to be remodeled. However, some good news: Denny’s opened 14 franchised restaurants and renovated 23 locations last year.

“We have made significant progress in our strategy to enhance the overall health of our flagship brand by accelerating the closure of lower-volume restaurants and completing 23 remodels, and also opened a record number of Keke’s Cafes while expanding into six new states,” CEO Kelli Valade said in an earnings statement. “Looking ahead to 2025, there is still work to be done within our brands, particularly as we navigate near-term-consumer sentiment that has been affected by macroeconomic factors.”