Red Lobster closed 130 locations in bankruptcy last year – and millions of Americans thought that was finally the end of the bleeding.
The new CEO promised a fresh start, sales were climbing, and the Cheddar Bay Biscuits were back.
Now he's telling the Wall Street Journal something very different – and if you've got a Red Lobster in your town, you need to read this.
Red Lobster CEO Reveals Plans to Close More Locations in 2026
CEO Damola Adamolekun sat down with the Journal this week and quietly admitted the chain is still reviewing its locations – and that people close to the company say they'd "ideally" have dozens fewer restaurants than they do right now.
Dozens.
Sales are up 10% from last year – but they're still below where the company was before it collapsed into bankruptcy in May 2024.
And many of the restaurants still open desperately need expensive renovations a cash-strapped company can barely afford.
Adamolekun acknowledged a trap Red Lobster set for itself back in 2014 – when a previous owner sold off all the company's real estate and saddled it with lease payments instead.
Some of those leases link high-performing restaurants to low-performing ones.
Meaning: they can't close the dogs without losing the winners too.
That's the kind of corporate mess that keeps CEOs up at night – and keeps customers guessing whether their local Red Lobster will have its lights on next year.
The Casual Dining Collapse Nobody in Washington Is Talking About
Red Lobster is just the most famous casualty in a full-scale massacre of casual dining in America.
TGI Fridays filed for bankruptcy in November 2024 – and went from 270 locations to about 85 in a single year.
Hooters filed for bankruptcy in March 2025, closed dozens more restaurants, and is now trying to reinvent itself as a "family friendly" chain – which tells you everything you need to know about how desperate things have gotten.
Denny's, Applebee's, Red Robin, Outback Steakhouse – every one of them is shuttering restaurants right now.
The full-service restaurant segment has shrunk nearly 18% since 2019.
That's not a trend. That's a collapse.
What Red Lobster's Bankruptcy Actually Cost Real Americans
The people getting hurt here aren't the executives in the boardroom.
They're the servers and managers who showed up to work one day and found the doors locked.
Red Lobster laid off 200 restaurant employees – many of them managers – late last year, with little notice.
And the chain is now negotiating with seafood vendors as Trump's tariffs push imported seafood costs higher – a pressure the CEO admits is real, even as he promises not to pass it on to diners.
Here's the bottom line: a brand that fed your family on birthdays and anniversaries for decades is still fighting for its life – because a foreign seafood conglomerate called Thai Union bought it, gutted the supplier relationships that made it run, and infamously turned a limited-time $20 shrimp promotion into a permanent menu item that hemorrhaged millions.
The American families who loved this place never had a say in any of it.
Sources:
- Eric Revell, "Red Lobster considering more restaurant closures, CEO says," Fox Business, February 17, 2026.
- Joe Guszkowski, "Red Lobster could close more restaurants, CEO says," Restaurant Business, February 13, 2026.
- "Bankruptcies wiped out a lot of full-service restaurant locations last year," Restaurant Business, July 9, 2025.
- "America has lost its appetite for casual dining chains," CNN Business, April 4, 2025.
- Damola Adamolekun, interview, "Good Morning America," ABC News, July 24, 2025.
