Denny’s to Close Up to 90 Restaurants
Denny’s, the iconic diner chain known for its all-day breakfast and hearty meals, has announced plans to close between 70 and 90 locations by the end of 2025. This move is part of a broader effort to streamline operations and improve financial performance.
Denny’s Plans to Shutter More Locations Than Expected
The decision, outlined in the company’s 2024 corporate report released on February 12, 2025, highlights an accelerated strategy to phase out lower-volume restaurants. Robert Verostek, Denny’s Chief Financial Officer, confirmed the closures during an investor call, stating that some of the affected locations are tied to lease expirations.
Last year, the company had initially projected the closure of 150 locations over a multi-year period. However, after shutting down 88 locations in 2024—including two in the Bay Area—the company is now on track to exceed its original estimates, potentially closing nearly 30 more locations than previously expected.
The Impact of Market Trends on Denny’s Decision
Denny’s CEO Kelli Valade addressed the closures, citing shifting trade areas and evolving consumer behaviors as key factors influencing the company’s decision.
“In any mature brand, restaurant locations need to adapt to market changes,” Valade stated. “Accelerating the closure of lower-volume restaurants will improve franchisee cash flow and allow them to reinvest in initiatives that drive customer traffic, such as our remodel program.”
The company also plans to open between 25 and 40 new locations in 2025, with roughly half being new Denny’s restaurants and the other half expansions of Keke’s Breakfast Cafe, a brand acquired in 2022.
Economic Pressures and Industry Challenges
Economic uncertainty has played a significant role in Denny’s strategic shift. Inflation rates, which hit 3% in January 2025, have impacted consumer spending, while severe weather events, including California wildfires and winter storms, have disrupted business operations across multiple locations.
The rising cost of food has also contributed to financial strain. Industry-wide concerns over bird flu and increased tariffs have driven up ingredient costs, forcing many restaurant chains to adjust pricing. For instance, Waffle House recently implemented a 50-cent surcharge on eggs in response to soaring prices.
No Advance Notice on Specific Closures
Denny’s has not provided a detailed list of which locations will close, stating that it does not offer advance notice of shutdowns. “We work closely with our owners and teams when a restaurant unfortunately has to close,” a Denny’s spokesperson told TODAY.com.
As of now, it remains unclear if any of the affected locations will be in California, where Denny’s operates 354 restaurants.
A Legacy of Growth and Change
Founded in Lakewood, California, in 1953 as Danny’s Donuts, Denny’s has grown into a globally recognized brand with approximately 1,700 restaurants worldwide. It adopted its current name in 1959 to avoid confusion with another chain, Coffee Dan’s, and began franchising in the 1960s, opening its first international location in Mexico in 1967.
While these closures signal a challenging period for the brand, the company remains focused on reinvesting in successful locations and adapting to shifting market demands. Denny’s continues to position itself as a leader in the casual dining industry, committed to serving customers 24/7, 365 days a year.
What’s Next for Denny’s?
Despite the closures, Denny’s is optimistic about the future. The company is prioritizing its remodel program, enhancing its menu offerings, and exploring new ways to engage customers in an evolving restaurant landscape. As economic conditions shift, Denny’s aims to remain a staple in the American dining experience while optimizing its operations for long-term success.
