An Iconic Burger Chain Abruptly Closes Locations In Several States As Financial Troubles Mount

A recent spat of closures, seeing Red Robin restaurants shutting their doors without warning, has ignited fears in fans of the chain. It is not unprecedented to see a restaurant chain abruptly shut down, but generally such an action comes with a declaration of bankruptcy. For Red Robin, that is not the case, with the chain closing restaurants in California, Illinois, and New Jersey with no warning aside from a note left on the door for would-be patrons. For those who have followed the financials of the company, however, these movements are perhaps not so surprising.

Red Robin has been operating at a significant loss for several years running as it attempts to rework its business model to maintain customer loyalty while adapting to changing markets. In fiscal year 2023, the company posted losses of $21.2 million. In 2024 that number skyrocketed to $77.5 million. The final numbers for fiscal year 2025 are not expected until February, however the third quarter numbers show a continued decrease in revenue and significant losses on the year. There is a spark of hope, however, as the year-to-date losses total only $13.7 million, which is a $24.6 million improvement compared to the previous year.

The improvement seen in Red Robin's numbers is thanks in part to its shedding of 15 unprofitable locations in 2025. These closures have been credited as part of the company's five-point "North Star" plan, announced in a 2023 press release, one goal of which was to close 70 restaurants in order to reduce costs. Those figures have changed as the financial status of the restaurant chain has improved, but given the company's stated expectations that comparable restaurant sales will show to a decrease of approximately 3% in the final quarter of fiscal year 2025, these cost-cutting measures are clearly important to Red Robin's continued goal of building financial strength and reducing debt.

In addition to closing underperforming restaurants, Red Robin has also taken measures to attempt to reach a different part of the market. Red Robin's burgers have always been the star of the show, served in a casual sit-down environment alongside bottomless fries and other sides, but the chain is now attempting to tap into a new market. The chain's Big Yummm promotion starts at just $9.99 for a double cheeseburger, bottomless fries, and a soft drink — with other options like a 10-inch pizza or chicken wrap available at a slightly higher price. This promotion is intended to lure away fast food customers, offering diners an opportunity to enjoy a similar meal in a full-service environment at a comparable cost.