Jack in the Box has announced it will close 150 to 200 underperforming restaurants. The decision is part of a major effort to cut costs and improve the company’s financial health.
Closures Target Debt Reduction
The fast-food chain plans to close 80 to 120 restaurants by the end of 2025. Jack in the Box currently has around 2,200 locations, mostly on the U.S. West Coast.
CEO Lance Tucker said the goal is to increase cash flow and reduce $300 million in debt within two years. He believes this move will help the company grow more consistently in the long term.
Del Taco Brand May Be Sold
Jack in the Box is also considering selling Del Taco, which it bought three years ago. The brand has faced rising costs and strong competition from chains like Taco Bell.
Tucker said Del Taco’s performance hasn’t helped the company’s earnings. He thinks the brand may do better under a new owner. Del Taco’s sales fell 3.6% last quarter, while Jack in the Box’s own sales dropped 4.4%.
Stock Prices Drop Sharply
The company’s stock price has dropped 57% over the past year. It fell another 7% in premarket trading this Thursday.
Other fast-food brands like McDonald’s and Chipotle are also seeing lower spending from customers. However, Taco Bell expects an 8% increase in sales, thanks to new menu items.
Looking Ahead
Jack in the Box is making big changes to stay competitive. Closing restaurants and selling Del Taco could help the company pay off debt and focus on what works best.
