While some may complain that fast food is too greasy or unhealthy, few can resist a juicy burger or fresh, salty fries. For many, these meals feel like a nostalgic guilty pleasure, yet the chains that once seemed like permanent fixtures of American culture are slowly disappearing, and not because consumers are suddenly choosing $20 salads instead.

As economic uncertainty grows, Americans have become more conscious about their spending. Foot traffic at once-bustling fast-food locations has declined, while rising inflation continues to push operating costs higher.

With sales slipping into the negatives, some beloved chains now find themselves spread too thin, trying to maintain far more restaurants than they can sustain. The struggles have caused many of them to make the difficult decision to scale back their portfolios to stay afloat.

Founded in 1969, Wendy’s, the Ohio-based American fast-food restaurant chain, has long been known for its iconic square burgers and signature Frosty dessert. With more than 6,000 locations nationwide, Wendy’s ranks among the top 10 largest fast-food restaurants in the U.S., according to 2025 data from ScrapeHero.

However, the company is feeling the pressure. In the third quarter of fiscal 2025, U.S. net sales fell 4.4% year over year, with same-restaurant sales down 4.7%. Wendy’s attributed the declines to lower customer traffic and rising labor costs.

Wendy’s Interim CEO and CFO Ken Cook acknowledged during an earnings call that U.S. sales remain under pressure, but emphasized that the company is acting with “urgency” to return to growth by implementing major changes across the business.

To counter weakening sales, Wendy’s has focused on three key actions since the third fiscal quarter: gaining a deeper understanding of its customers, streamlining operations, and strengthening its relationship with franchisees.

Wendy’s launches a new turnaround strategy amid hundreds of planned store closures.

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Wendy’s Project Fresh aims to drive growth

After reassessing its business, Wendy’s will now prioritize increasing average unit volumes (AUV) over net restaurant growth in the U.S. To fulfill its new goals, the company launched Project Fresh, a turnaround plan to drive profitable growth and long-term value across its U.S. system.

Project Fresh aims to attract new customers through targeted marketing and boost visit frequency by improving the overall guest experience. The initiative is meant to revitalize the brand, reignite growth, accelerate profitability, and strengthen shareholder value.

Wendy’s Project Fresh key areas

  • Brand Revitalization: Differentiate Wendy’s from the competition by using high-quality ingredients and establishing a more relevant brand presence.
  • Operational Excellence: Enhance customer experience through improved hospitality, digital tools, equipment efficiency, processes, labor, technology, and training.
  • System Optimization: Prioritize U.S. AUV growth and restaurant performance by optimizing labor, operating hours, and franchise profitability, while leveraging insights from company-operated restaurants and adopting a returns-based approach to franchisee investments. Internationally, the chain plans to maintain strong capital deployment to support expansion.
  • Capital Allocation: Align capital expenditures with U.S. AUV growth priorities by reducing the Build to Suit program by around $20 million in 2025, with a larger reduction anticipated in 2026, and increasing investment in technology and marketing. The company also plans to identify additional capital efficiencies while maintaining dividends supported by strong free cash flow.

“Wendy’s Board of Directors and management team are dissatisfied with the current valuation of the Company and have been working to put the Company on the right path to create value for our franchisees, employees, and shareholders,” said Wendy’s Board Chair Art Winkleblack in a statement. “Execution is underway, and we are confident that Project Fresh will position Wendy’s as the industry leader.”

Wendy’s plans store closures

As part of its turnaround strategy, Wendy’s (WEN) also revealed plans to close restaurants nationwide beginning in the fourth quarter of 2025 and continuing into 2026, with “mid-single-digit percentage” of its U.S. locations expected to be affected. Because the chain had 6,011 U.S. restaurants at the end of the third quarter, this could amount to approximately 300 closures.

The closures will target underperforming stores that no longer meet Wendy’s standards. The company aims to concentrate resources on the remaining locations, improving them with new technology and operational upgrades. The chain believes this strategy will boost sales and profitability at nearby stores.

More Restaurant Closures:

  • 61-year-old fast-food chain quietly closes dozens of restaurants nationwide
  • Popular local bakery chain closing all stores next month
  • 98-year-old beer store chain has closed nearly 100 locations so far

“When we look at the system today, we have some restaurants that do not elevate the brand and are a drag from a franchisee financial performance perspective. The goal is to address and fix those restaurants,” said Cook in an earnings call.

These closures follow the shutdown of 140 locations in 2024, as Wendy’s planned to open 500 new restaurants by the end of that year, which was revealed during an earnings call the same quarter last year.

The restaurant industry’s persistent struggles

Wendy’s challenges are part of a broader trend affecting the entire restaurant industry. 

Prices for food away from home rose 3.7% in the 12 months ending September 2025, according to recent U.S. Bureau of Labor Statistics data.

As a result, traffic across the food service industry dropped by 1% in the quarter ending June 2025, according to Circana.

“This poses a significant challenge for restaurants, as home-cooked meals directly substitute demand for dining establishments, translating to reduced revenues and declines in customer traffic as demand shifts to grocery stores,” said Coresight Research analyst Sujeet Naik.

Even fast food, once the most accessible and affordable dining option, has become increasingly difficult for many Americans to fit into their already tight budgets.

Finance Buzz reported that menu prices increased between 39% and 100% from 2014 to 2024, outpacing the national inflation rate of 33% during the same period. Wendy’s, Arby’s, and Burger King have each raised their prices by 55%.

Coincidentally, Arby’s and Burger King have both also closed several locations this year, with more closures expected in 2026.

Restaurant closures at Wendy’s fast-food chain rivals

  • Arby’s: At least 14 locations closed across eight states.
  • Burger King: Shuttered multiple restaurants after one of its franchisees filed for Chapter 11 bankruptcy in April.

“Consumers are saying, ‘We’re struggling, or we’re beginning to struggle or we’re thinking more carefully about what we spend,'” said Harvard Business School Consultant and Lecturer on Restaurants Michael S. Kaufman.

“I don’t know that the ability to maintain the large fleets of traditional casual dining restaurants can continue.”

Related: Popular sports bar restaurant chain quietly closes another location