Goodbye Jack in the Box: The West Coast restaurant franchise to close 150 to 200 “unperforming” locations

American fast food restaurant chain Jack in the Box announced plans this week to close 150 to 200 “unperforming” locations as it looks to restructure and clear or at least drastically reduce its $300 million debt over the next two years.

Jack in the Box, which has around 2,000 franchised units in the US, will close between 80 to 120 “underperforming” restaurants by the end of 2025. The remaining locations will close in accordance with the termination dates of their respective franchise agreements.

Jack in the Box identify locations where sales are declining

According to the chain’s last annual report, same-store sales were down 2.1% in the fourth quarter of 2024 and restaurant-level profit margins stood at 9.3% for the fourth quarter, a decrease from 14.8% in the prior year period. The company attributed that decline to a drop in transactions, combined with inflationary increases in wages and commodities, which was partially offset by menu price hikes.

The San Diego-based opened 16 new restaurants during the fourth quarter of 2024 and closed another 20.

Lance Tucker, who took over from Darin Harris last month explained in a press release: “In my time thus far as CEO, I have worked quickly with our teams to conclude that Jack in the Box operates at its best, and maximizes shareholder return potential, within a simplified and asset-light business model.

“Our actions focus on three main areas: addressing our balance sheet to accelerate cash flow and pay down debt, while preserving growth-oriented capital investments related to technology and restaurant re-image; closing underperforming restaurants to position ourselves for consistent net unit growth and competitive unit economics; and, an overall return to simplicity for the Jack in the Box business model and investor story.”

Jack in the Box, chain known for its signature “Jumbo Jack” burger and waffle breakfast sandwich, remains one of the top five hamburger chains in the US with a revenue of $1,934,000.

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