Denny’s, the U.S. chain known for its diner-style seating and round-the-clock hours is closing a hefty chunk of restaurants. Over the next year, 150 locations will close their doors. The restaurant chain will also reassess its uninterrupted hours.
The company made the announcement about impending changes in an earnings call Tuesday. According to executive vice president Steve Dunn, the first 50 restaurants will close by the end of the year. Another 100 will close sometime in 2025, leaving about 1,375 locations still functioning.
Fast Company has reached out to Denny’s for a list of locations marked for closure, and will update this post if we hear back.
Dunn said the restaurants that will close are those that have been “underperforming” but are too old to be remodeled, or are in struggling areas. Other restaurants, he said, will have the opportunity to be a part of a redesign program called Diner 2.0. The program will give financial incentives to franchisees who choose to renovate, such as a $100,000 grant. According to Dunn, restaurants that make the effort to renovate can see around a $400,000 boost in sales.
On Denny’s operating hours, which Americans have grown used to, Dunn also said being always open, 24 hours a day, 7 days a week, no longer works for the chain. He noted that it “didn’t make sense” for restaurants to stay open with few clients during the nighttime hours.
Those aren’t the only changes that will be showing up at Denny’s. On top of a 10th of the restaurants closing, some getting a total makeover, and others likely ending their 24/7 hours, the menus will get slashed. The number of menu items will be cut in half, going from 97 down to 46.
Denny’s is certainly not the only chain that has been showing weaker sales. As Americans trim their budgets for going out to eat, even more affordable chains like Denny’s have fallen by the wayside. A number of fast-casual restaurants like Roti and Red Lobster have filed for bankruptcy in recent months. Dunn also noted that Denny’s has been plagued by customers still coming in but trimming their bill by ordering off the kid’s menu.
Denny’s stock is down 50% for the year, with shares down 17% Tuesday.