Wendy’s to Shutter Up to 358 U.S. Locations After Same-Store Sales Crater 10%

Wendy's to Shutter Up to 358 U.S. Locations After Same-Store Sales Crater 10%

Wendy's announced Friday it will close as many as 358 U.S. restaurants in the first half of 2026—up to 6% of its domestic footprint—after fourth-quarter same-store sales plummeted 10%, significantly worse than the 8.5% decline Wall Street had braced for. The closures come as the 57-year-old burger chain scrambles to reverse a sales slide that has now persisted through multiple quarters, with interim CEO and CFO Ken Cook acknowledging the company "swung the pendulum too far" on promotional pricing strategy.

For finance chiefs watching the restaurant sector's ongoing value war, Wendy's results underscore a brutal reality: even aggressive discounting can backfire when customers perceive the baseline offering as overpriced. The Dublin, Ohio-based company's U.S. same-store sales fell even harder than the global figure in the October-December period, though Wendy's didn't disclose the specific domestic decline. The company had already closed 28 locations in the fourth quarter, ending 2025 with 5,969 U.S. restaurants, and shuttered 240 locations throughout 2024.

The planned closures—between 5% and 6% of the U.S. base—represent an acceleration of Wendy's real estate rationalization. Many locations are "simply out of date," the company said, echoing a refrain heard across the quick-service sector as chains confront aging assets and shifting consumer traffic patterns. The move mirrors similar footprint optimization at McDonald's, Taco Bell, and other rivals, all of whom are simultaneously chasing inflation-weary customers with value offerings.

Cook's admission about promotional strategy is particularly telling. Rather than building sustainable everyday value, Wendy's leaned heavily on limited-time price promotions in 2025—a tactic that apparently trained customers to wait for deals rather than visit regularly. In response, the chain launched a permanent "Biggie Deals" value menu in January with three tiers: $4 Biggie Bites, $6 Biggie Bags, and an $8 Biggie Bundle. The company is also betting on new product innovation, including a forthcoming chicken sandwich, to drive traffic.

Despite the sales carnage, Wendy's reported fourth-quarter revenue of $543 million, down 5.5% year-over-year but slightly ahead of the $537 million analysts expected. The revenue beat suggests the company is at least maintaining pricing power even as traffic evaporates—a mixed blessing for a CFO trying to balance margin preservation with volume recovery.

The company's guidance offers modest optimism, projecting flat global systemwide sales for 2026 after a 3.5% decline last year. That forecast assumes the U.S. turnaround takes hold and international growth offsets continued domestic weakness—a scenario that will require flawless execution of the value menu strategy and successful new product launches.

Investors, for their part, seemed relieved the news wasn't worse. Wendy's shares rose nearly 5% in midday trading Friday, suggesting the market had priced in an even grimmer scenario. But the stock reaction also reflects a broader question facing restaurant finance teams: at what point does aggressive unit closure signal prudent portfolio management versus a brand in structural decline?

The answer may depend on whether Wendy's can prove its value strategy learned the right lesson. Everyday affordability, not promotional whiplash, is what brings customers back between paychecks. For a chain closing hundreds of locations while competitors expand, that lesson needs to stick—and fast.