Industry News
U.S. same-store sales fell 5.6% in 2025 and 11.3% in Q4 alone as the chain closes 5 to 6 percent of its system in the first half of 2026.
Project Fresh is Wendy's turnaround plan announced alongside Q4 2025 earnings. It targets 298 to 358 underperforming U.S. restaurants for closure in the first half of 2026, while repositioning the brand around everyday value pricing rather than short-run promotional campaigns.
Between 298 and 358 U.S. locations—roughly 5% to 6% of the system—are slated for closure by mid-2026. The closures target restaurants that both the company and franchisees identified as consistently underperforming in a high-cost operating environment.
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A Q4 2025 same-store sales decline of 11.3% and a full-year decline of 5.6% affect all stores, not just those closing. Prospective buyers should request trailing four-quarter unit-level sales data and stress-test projected returns against continued softness before signing a franchise agreement.
Wendy's will close between 298 and 358 U.S. restaurants in the first half of 2026, executives said—representing 5% to 6% of the chain's total system. The closures, part of a turnaround initiative called Project Fresh, follow a difficult fiscal year in which U.S. same-store sales fell 5.6% across 2025 and collapsed 11.3% in the fourth quarter alone [1]. By the end of Q1 2026, the chain had already shed 174 net locations, leaving 5,805 restaurants operating systemwide [1].
CEO Ken Cook announced the closure plan alongside Q4 2025 earnings, describing the targeted restaurants as "consistently underperforming" units selected in coordination with franchisees who flagged their own locations as candidates for shutdown [1]. Wendy's framed the closures not as a sign of system failure but as deliberate pruning to focus capital and management attention on higher-volume stores.
The scope of the problem emerged clearly in the financials. Global systemwide sales declined 8.3% in Q4 2025 and 3.5% for the full year [2]. The chain's U.S. same-store sales performance was the worst in recent memory: down 5.6% for the year and 11.3% in the final quarter—a figure that raises questions about how much of the decline is cyclical versus structural [1].
Cook said the company had leaned too heavily on short-run promotional pricing rather than a durable everyday value model. Project Fresh is meant to reposition the brand around the latter, with the closure program clearing out units too weakly positioned to compete in a high-cost labor and food environment [2].
For anyone evaluating a Wendy's franchise, the closure program is a structured signal, not a surprise. Wendy's franchisees operating stores that made the closure list were, in most cases, parties to the decision—the company worked with franchisees to identify underperformers before announcing numbers publicly.
The more significant data point for prospective buyers is the Q4 2025 same-store sales figure of negative 11.3% [1]. That number covers all stores, including those not on the closure list. It suggests the demand-side challenge is system-wide, not confined to a distressed subset. Buyers entering due diligence on a Wendy's location should request Item 19 financial performance representations alongside unit-level sales data for the trailing four quarters and stress-test against further same-store sales softness.
The everyday value pivot Cook described is also worth scrutiny. Wendy's competes directly with McDonald's and Burger King on value positioning. Whether Wendy's can re-establish value credibility after years of premium promotional campaigns is the central strategic question for prospective franchisees evaluating the brand's five-year outlook [3].
The Project Fresh timeline concentrates closures in H1 2026. The Q2 2026 earnings report—expected in August—will be the first signal of whether the value repositioning is generating traffic. Watch same-store sales comps from McDonald's and Burger King in the same period as an industry benchmark.
For franchisees in markets where multiple Wendy's stores are closing simultaneously, the immediate question is territory reallocation. Franchise agreements typically contain right-of-first-refusal provisions on adjacent territory; affected operators should review their development agreements before the closures complete in mid-2026.
Finally, watch Wendy's Item 20 FDD updates. Franchise Disclosure Documents filed after mid-year must reflect closures that occurred in the reporting period. A buyer reviewing an FDD for a new Wendy's location after the closure program completes will have a cleaner signal of the surviving system's performance [3].