TGI Fridays filed for Chapter 11 bankruptcy protection over the weekend, the Associated Press reports. The move follows the closure of around 50 locations nationwide the previous week, CNN reports, and more than 80 closures in total for 2024. “The company expects to use the time and legal protections made available through the Chapter 11 restructuring process to allow the company to explore strategic alternatives in order to ensure the long-term viability of the brand,” a statement from TGI Fridays said.
The casual behemoth is headquartered in Dallas. Its executive chairman, Rohit Manocha, cited that the cause of its current woes are financial challenges from COVID-19 and the chain’s financial structure in a statement.
TGI Fridays operates a mix of franchised and company-owned restaurants that span 41 countries. The franchised locations (as well as the brand and intellectual property, both owned by the overarching TGI Fridays Franchisor, LLC) are not affected by the filing.
Eater noted in a 2017 piece that the fate of TGI Fridays and its ilk of casual sit-down chains have been falling out of favor and facing financial challenges for a decade; at the time, that was the worst-performing sector of the hospitality industry. The decline of these chains is related to the declining spending power of the middle class, which has only shrunk further in the ensuing years and in the wake of the pandemic. Bloomberg agrees, noting that the filing is due to tighter consumer budgets and a preference for fast food.
It feels like a rare misstep for Dallas-based chains, many of which are thriving. Most notably Chili’s — which was attributed in a 2024 earnings report to a boost in popularity from TikTok, where the Triple Dipper appetizer went viral, and to an ad campaign that took shots at the rising costs of fast-food restaurants while promoting its $10.99 Big Smasher meal. Also notably seeing success is Velvet Taco, more of a fast causal restaurant with sit-down options, which went from being a regional chain to opening locations across the U.S. to now opening its first location in London and offering “build your own” taco kits that ship nationwide. Dallas-based breastaurant chain Twin Peaks has opened over 100 locations and is expected to surpass $1 billion in sales by 2027.
Meanwhile, the casual chain Red Lobster also filed for Chapter 11 bankruptcy this year, after years of mismanagement and pressure from its private equity investors. Hooters is working to avoid a financial woes of its own amid closures and declining revenue, according to Bloomberg.
Feels like it’s out with the old and in with the new — or, at least, in with the viral.
