Pizza Hut is preparing to close 250 restaurant locations across the United States as its parent company, Yum! Brands, undertakes a comprehensive strategic review of the struggling pizza chain. The announcement came during Yum!'s fourth quarter 2025 earnings call on Wednesday, revealing that the closures will target underperforming outlets and are scheduled to occur throughout the first half of 2026.
Strategic Review Underway
Yum! Brands, which also owns popular fast-food chains Taco Bell and KFC, disclosed that the planned closures represent approximately 3 percent of Pizza Hut's total US footprint. The company did not specify which individual locations would be affected by the shutdowns. This move follows CEO Chris Turner's statement in November 2025 that the company had initiated a "formal review of strategic options" for Pizza Hut, including the potential sale of the chain.
Financial Performance Concerns
The decision comes amid concerning financial performance for Pizza Hut's US operations. According to the company's earnings release, Pizza Hut experienced a 3 percent decline in same-store sales during the fourth quarter of 2025, with a more significant 5 percent drop for the entire year. This contrasts sharply with the performance of other Yum! brands, particularly Taco Bell, which has successfully attracted new customers through innovative menu introductions.
During Wednesday's earnings call, Yum! CFO Ranjith Roy confirmed that the closures would specifically target underperforming locations as part of efforts to revitalise the struggling chain. The company indicated it could not discuss details of the ongoing strategic review but expects it to be completed within the current year.
Historical Context and Market Position
Pizza Hut, which first launched in 1969 and became the world's top pizza chain by sales within just two years, now operates nearly 20,000 stores across more than 100 countries. Despite this global presence, approximately half of the company's sales originate from the United States, where it maintains about 6,500 locations.
The current challenges follow previous difficulties for the chain, including a 2020 bankruptcy filing by one of Pizza Hut's largest franchisees that resulted in the closure of 300 stores. The chain has faced increasing competition from rival pizza delivery services like Domino's Pizza, which has captured significant market share in recent years.
Yum! Brands itself has an interesting corporate history with Pizza Hut. The pizza chain was acquired by PepsiCo in 1977 before being spun off as part of the restaurant division that eventually became Yum! Brands in 1997. The current strategic review represents the latest chapter in the company's efforts to address Pizza Hut's ongoing performance challenges in the competitive US fast-food market.
