Jack in the Box closing 200 restaurants, fights to survive

16 Dec 2025, 17:13 · The Fresno Bee

When people get more conservative with spending, it hurts restaurants that lack a true following. Some people love chains such as Chipotle, Chick-fil-A, Starbucks, and even McDonald's.

They view spending money at those brands as a reasonable indulgence, something they may not truly be able to afford, but a treat they deserve.

It's something that has hit lower-income Americans hard.

"Over 40% of low-income U.S. adults claim to be visiting quick-service restaurants (QSRs) less often for dinner and lunch than at the start of this year," said Wendy Wallner, an executive vice president and client officer at Ipsos.

Ipsos conducted a wide-ranging survey examining how Americans have been spending money on fast food, and there is a clear disparity.

"In comparison, just 30% of those earning over $100k say they're eating less fast food, suggesting that this downturn can be more strongly attributed to flagging consumer confidence than to GLP-1 drugs or shifting tastes - at least for the time being," the Ipsos study showed.

Overall, however, Americans have tightened their purse strings, and that's not great for chains without a loyal following.

"2024 will be known in part for price and value wars in both QSR and grocery as these sectors fight over value-seeking customers," Wallner said.

Jack in the Box lacks an audience

While Jack in the Box has its fans, it's fair to say the chain lacks enough of a dedicated audience to keep it successful during difficult financial periods.

Jack in the Box draws casual, occasional (sometimes inebriated) diners, especially in social or late-night contexts. That audience exists, but it's too small and intermittent to drive lasting success.

The company has been struggling, according to numbers it shared during its fourth-quarter earnings call.

Combined system same-store sales declined 7.4% at Jack in the Box, with negative transactions and channel mix cited as key drivers, partly offset by a 2.4% price increase.
Jack in the Box restaurant-level margin fell by 240 basis points to 16.1% year over year, primarily due to sales deleverage, 6.9% commodity inflation, and higher labor expenses.
Management said 2026 will very much be a rebuilding year, explicitly highlighting ongoing operational deficiencies and lagging operational discipline that must be addressed.
Total debt at year-end stood at $1.7 billion, with a net debt to adjusted EBITDA leverage ratio of six times, flagged as a target for significant paydown in the coming year.

CEO Lance Tucker made it clear that the company needs to turn its fortunes around.

"While we are pleased with our progress on our Jack on Track initiatives, we are clearly not satisfied with our 2025 operating performance, and we are rebuilding our operational discipline to drive growth and shareholder value in 2026 and well beyond," he shared.

Jack in the Box has struggled to find its audience. Shutterstock

Jack in the Box sells Del Taco

Jack in the Box recently closed the sale of its Del Taco brand for $115 million, a massive loss on the more than $575 million the company paid for the brand in 2022.

"This divestiture is an important step in returning to simplicity, and we look forward to focusing on our core Jack in the Box brand," Jack in the Box chief executive Lance Tucker said in a press release. "After a robust process, we are confident we have entered into a transaction with the right steward for Del Taco in its next chapter of evolution."

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The transaction fits into the company's "Jack on Track" strategy.

"The burger giant will use money from the transaction to pay off debt. The move, which is expected to close by January 2026, will also allow Jack in the Box to focus on its core business," QSR Magazine reported.

Jack in the Box closing restaurants

Jack on Track is a fiscal austerity plan designed to save Jack in the Box.

"Our actions today focus on three main areas: addressing our balance sheet to accelerate cash flow and pay down debt, while preserving growth-oriented capital investments related to technology and restaurant reimage; closing underperforming restaurants to position ourselves for consistent net unit growth and competitive unit economics; and, an overall return to simplicity for the Jack in the Box business model and investor story," Tucker said in a press release.

Closing underperforming stores is a major component of the plan.

Jack in the Box will implement a block closure program, which is projected to result in the closure of approximately 150-200 underperforming restaurants, a majority of which have been in the system for over three decades.
The program will consist of approximately 80-120 restaurant closures between now and Dec. 31, 2025, with the remaining underperforming restaurants closing thereafter based upon respective franchise agreement termination dates.
This program does not include the expected 1.5% to 2.0% of system unit closures for FY 2025, and an ongoing annual closure rate thereafter of approximately 1% of system units beginning in FY 2026.
Upon completion of the program, Jack in the Box expects to deliver consistent, positive net unit growth, helped by the strong performance of new markets and tremendous whitespace opportunities.

Source: Jack in the Box

Experts are skeptical of Jack in the Box's plan

"TD Cowen has reduced its price target on Jack in the Box to $16 from $21 while maintaining a Hold rating on the fast-food chain's stock. The new target sits slightly above the stock's current price of $14.38, which is hovering just 1% above its 52-week low of $13.99.

"The price target reduction follows what TD Cowen describes as a 'tough end to fiscal 2025' for the company, which is in the early stages of implementing its 'Jack on Track' turnaround plan amid challenging industry conditions. InvestingPro data shows the stock has plummeted nearly 68% over the past year, significantly underperforming the broader market," Investing.com reported.

Valuation and expectations for the brand vary quite a bit depending upon the analyst.

"Jack in the Box Inc. has a consensus price target of $29.7 based on the ratings of 21 analysts. The high is $73 issued by B of A Securities on October 22, 2024. The low is $15 issued by Barclays on November 20, 2025. The 3 most recent analyst ratings were released by Piper Sandler, Citigroup, and Barclays on November 21, 2025, November 20, 2025, and November 20, 2025, respectively. With an average price target of $16 between Piper Sandler, Citigroup, and Barclays, there's an implied -20.58% downside for Jack in the Box Inc. from these most recent analyst ratings," Benzinga reported.

Where Jack in the Box stands now

Sales trends remain weak: Jack in the Box reported a 7.4% same‑store sales decline in Q4 2025, reflecting continued traffic and mix challenges, according to Jack in the Box.
Fiscal results showed pressure: Revenue dropped ~6.6% year over year, and EPS significantly missed expectations at $0.30.
Margins under strain: Restaurant‑level margins fell notably as costs from commodities and labor rose, shared The Motley Fool.
"Jack on Track" remains central: The company is pushing operational fixes, value offerings, and system retraining to stabilize the business, according to Simply Wall St.
Debt reduction priority: Management is focused on paying down heavy leverage and strengthening the balance sheet, a key part of recovery strategy, shared Yahoo Finance.
Del Taco divestiture completed: Jack in the Box sold Del Taco to a franchisee for $115M, sharply below its original acquisition cost, according to Restaurant Dive.

TheStreet

This story was originally published December 16, 2025 at 9:13 AM.