Papa Murphy’s plans to close up to 50 corporate-owned restaurants, adding to a growing list of pizza chains shrinking their footprints as operators take a closer look at their real estate.
The pizza chain, which is owned by Canada-based MTY Food Group, will shutter between 45 and 50 corporate-owned Papa Murphy’s locations, following a store-by-store review that evaluated each location’s performance outlook and economic profiles, said MTY’s Chief Executive Officer Eric Lefebvre on the company’s second-quarter earnings call.
Those closings are expected to return dozens of retail spaces to the market as the restaurant operator seeks to improve profitability while continuing to open new stores.
“Where we saw a path to improvement, we chose to continue investing efforts into making our existing assets as productive as they can be,” said Lefebvre on the call. “Where the fundamentals no longer supported that path, we made the decision to close the store.”
Papa Murphy’s joins other quick-service chains like Pizza Hut and Papa Johns in announcing restaurant closures this year.
Papa Johns in February announced plans to close about 300 North America stores by the end of 2027. Yum Brands reached an agreement to sell its Pizza Hut division in June, months after it announced it plans to close 250 stores this year. A prominent Pizza Hut franchisee, however, is working to revive sales using nostalgic designs.
Domino’s, on the other hand, plans to open 175 stores this year, joining more than 22,000 locations worldwide.
MTY franchises and operates more than 7,000 locations across 80 different brands in the United States, Canada and internationally.
Its portfolio includes Cold Stone Creamery and Wetzel’s Pretzels, which Lefebvre referred to as MTY’s “strongest brands” for unit growth on the call.
MTY reported profits of $59.9 million during the second quarter, down roughly 14% from the prior-year period. In addition to weaker corporate-store performance, the company cited softer consumer traffic and inflation as reasons for the drop.