Papa Johns has closed 44 restaurants across 17 US states in the first quarter of this year, the latest step in a broader plan to shut around 300 North American locations by the end of 2027 as the pizza chain battles falling sales and intensifying competition.
The closures, identified through an analysis of corporate filings, were concentrated in major markets including Texas, California, Florida and Arizona, with further closures in states such as Michigan, North Carolina and Virginia. Most of the affected restaurants are franchise-owned stores that have been operating for more than a decade and generate less than $600,000 in annual sales.
Company executives say the strategy is designed to strengthen the overall franchise system by removing weaker-performing locations and allowing remaining franchise owners to concentrate resources where they are most effective. Papa Johns Chief Financial Officer Ravi Thanawala previously told investors: “We believe these closures will further strengthen the system,” adding that the move is expected to improve average sales volumes and overall franchise health.
The closures come during a difficult period for the Louisville, Kentucky-based chain. Papa Johns’ shares have fallen more than 20 per cent so far this year and are down nearly 70 per cent over the past five years as the company struggles to reignite growth. It has also cut approximately 7 per cent of its corporate workforce as part of wider cost-saving efforts.
Industry experts say pizza chains are facing mounting pressures on multiple fronts. Rising labour costs, higher ingredient prices and lingering inflation have squeezed both operators and consumers, while the pizza category itself has become increasingly crowded. According to a recent Wall Street Journal report, pizza restaurants are now outnumbered by Mexican restaurants and coffee shops in many markets, intensifying competition for consumer spending. Rivals have not been immune either — Pizza Hut has closed hundreds of locations in recent years, with reports suggesting parent company Yum! Brands has explored strategic options for the chain amid slowing sales growth.
Papa Johns has also found itself embroiled in a separate controversy over tipping culture. A viral TikTok video drew attention to a message printed on the company’s pizza boxes reading: “Delivery fee is not a tip. Please reward your driver for outstanding service.” The post attracted more than 1.6 million views and sparked debate, with critics arguing companies should pay workers fairly rather than relying on customers to supplement wages through tips. The row comes amid growing frustration in America over so-called “tipflation,” with a recent survey finding that roughly three-quarters of Americans believe tipping culture has gone too far, and many reporting they feel pressured to tip even when service falls short.
The chain has attempted to drive footfall through menu innovation, including a revamped pan pizza with a crispy garlic parmesan crust and the return of limited-time offerings such as its heart-shaped Valentine’s Day pizza. However, these efforts have not been sufficient to offset slowing demand.
Papa Johns has not publicly identified which specific locations are closing, stating only that the restaurants selected for shutdown are failing to meet brand expectations. For customers, the closures mean some longtime neighbourhood pizza outlets may soon disappear as the company reshapes its footprint, with the broader aim of building a smaller but healthier restaurant base capable of competing in an increasingly crowded fast-food landscape.
