After announcing plans to close hundreds of underperforming locations in the first half of 2026, a fast-food burger chain has revealed major changes across its business, including the possibility of additional restaurant closures, as it works to reverse ongoing declines in traffic and sales.
The company has also acknowledged that its focus on cost and efficiency has, in some cases, weakened the brand’s differentiation, a challenge it now faces as competition in the restaurant industry grows.
The chain is also facing challenges with customer satisfaction. Wendy’s scored 77 out of 100 in the American Customer Satisfaction Index (ACSI), placing it below several major fast-food rivals in the 2026 rankings.
Wendy’s new strategy to boost growth
Wendy’s (WEN) is taking action after reporting its sixth consecutive quarter of declines, launching a major turnaround plan and updating its capital allocation strategy to provide the flexibility needed to support that effort.
“Today we are clearly not performing at our potential,” said Wendy’s President and CEO Bob Wright in the company’s second-quarter fiscal 2026 earnings release. “I returned to Wendy’s because I believe we can fix our issues and I am excited to work with our team and our franchisees to drive a strong turnaround.”
Related: Wendy’s makes a huge customer service mistake
The company says it has implemented measures across five areas it has identified as critical to the turnaround: rebuilding a quality menu at compelling value, marketing that drives demand, operational excellence, a digital experience that builds frequency, and restaurants as an engine for growth.
“We’ve already started looking at necessary restructuring and reorganization efforts, and I look forward to sharing more details with you as they develop,” said Wright. “I’ll be closely engaged in key decisions across the organization and ensure we are moving with focus, speed, and accountability.”
The need for a turnaround comes as Wendy’s continues to face pressure on restaurant traffic and sales. During the second quarter of fiscal 2026, the company reported:
- Global systemwide sales declined 6.5% year-over-year
- U.S. systemwide sales fell 8.2%
- U.S. same-restaurant sales decreased 7%
Wendy’s may close more restaurants
The turnaround effort follows Wendy’s announcement that it had already shuttered 28 locations during its fourth-quarter fiscal 2025 earnings call and expected to close between 5% and 6% of its U.S. restaurants, or roughly 289 to 358 underperforming units, during the first half of 2026.
Additional closures could follow.
During the company’s second-quarter earnings call, Wright indicated that Wendy’s could close individual restaurants when doing so would improve the financial health of a franchisee’s overall portfolio.
“If we need to use closures of a few restaurants here and there to make a portfolio a little bit healthier and help that franchisee get to the right place,” said Wright. “At the end of the day, nothing cures financial health in a restaurant system like top-line growth.”
Here’s some of my previous coverage of restaurant closures:
- 30-year-old restaurant chain confirms more closures in 2026
- Popular breakfast chain closes more restaurants
- Popular beverage chain closing multiple locations nationwide
Wright added that although additional closures may occur, the company will work with franchisees to help restore their portfolios to health, rather than pursue closures simply to reduce the brand’s size.
“If the trade area’s moved on and it is a financial drag on that portfolio, then we’re going to support the closing of that location for the health of the system,” said Wright.
That distinction is important as Wendy’s attempts to improve its performance. The company’s strategy is not solely focused on shrinking its restaurant footprint.
Instead, management says closures may be used selectively when individual locations are no longer financially viable, while the broader turnaround focuses on bringing customers back through menu improvements, value, marketing, operations, and digital initiatives.
What this means for the future of Wendy’s
Wendy’s expects traffic headwinds to continue affecting its ability to return to year-over-year systemwide sales growth in either the third or fourth quarter.
The company also predicts continued pressure on company-operated restaurant margins and adjusted EBITDA in the second half of the year because of sales deleverage.
As a result, Wendy’s is withdrawing its 2026 financial outlook to allow the new leadership team to fully assess business opportunities and formulate a comprehensive turnaround plan, including the optimal deployment of capital.
For consumers, the turnaround could bring changes to Wendy’s menu, value offerings, restaurant operations, and digital experience as the company works to increase traffic. For franchisees, the strategy could also result in additional closures in markets where individual restaurants are no longer financially viable.
Wendy’s hired former Potbelly executive Steve Cirulis as the company’s new CFO and Chief Strategy Officer in June 2026. Cirulis previously worked alongside Wright, who led the sandwich chain through a brand turnaround before becoming Wendy’s CEO in May 2026.
“As we move forward, our priorities will be maintaining financial discipline, making thoughtful investment choices, and supporting the actions needed to improve performance across the system,” said Cirulis during the earnings call.
For Wendy’s, the next phase will depend on whether its new strategy can reverse the company’s sales and traffic declines while improving the financial health of its restaurant system. Until then, additional closures remain one of the options management may use as it evaluates the chain’s underperforming locations.
Related: 17-year-old Mexican restaurant chain closes all locations
