Guzman y Gomez (GyG) is closing its US operations after failing to gain traction in a market already saturated with Mexican food, reinforcing the country's reputation as a 'graveyard' for Australian fast food chains. The company told shareholders on Friday that the performance of its US stores was unacceptable, despite its ambition to become the world's largest restaurant company.
GyG currently lists eight stores in the Chicago area on its US website. The closures are expected to cost up to US$40 million (A$56 million) in one-off costs. Founder and co-chief executive Steven Marks said the US business could no longer justify the required investment. 'Having spent the last three months in the US, I realised this was going to take significantly more time and capital than we had expected,' he said.
Analysts had previously doubted GyG's ability to compete with established chains like Chipotle and numerous Latin American restaurants. The company had offered larger burritos in the US than in Australia to appeal to American customers, who typically demand bigger portions. RBC Capital Markets analyst Michael Toner called the US exit a positive development, noting that the losses were weighing down the group's earnings.
GyG said Australia remains its core focus, though it is also expanding in Singapore and Japan. At the end of 2025, GyG had 237 stores in Australia, making it the ninth largest chain. Its share price rose over 15% on Friday after the announcement, though it remains below the initial public offer price of $22.
