Noodles & Company is charting a new course, but it involves saying goodbye to some of its locations. As a turnaround plan takes hold, the brand is mapping out a strategic yet painful move to shutter underperforming restaurants, a decision spurred by sales figures that have failed to meet expectations and a notable decline in customer traffic.
Noodles & Company announces major closures as new CEO steps in
Noodles & Company is tightening its footprint, with plans to close as many as 49 restaurants by the end of 2026 in a sweeping bid to boost performance. The company expects 28 to 32 locations to shutter this year alone, followed by another 12 to 17 next year. Nine company-owned restaurants have already closed in 2025, and 13 more are slated for closure in the third quarter.
The move targets locations with negative cash flow, a strategy the chain says has already paid off—sales and profits have risen at nearby stores after previous closures. As of the second quarter, Noodles & Company counted 364 corporate units and 89 franchises in its system.
The restructuring announcement comes during a major leadership change. CEO Drew Madsen, who has led the brand for nearly a year and a half, will step down for health reasons. Taking his place is President and COO Joe Christina, a seasoned restaurant industry leader and former CEO of Tijuana Flats, who will now guide the pasta chain through its turnaround efforts.
Mixed Q2 results add urgency to Noodles & Company’s turnaround plan
The planned closures and leadership shake-up come on the heels of a second-quarter performance that underscored why Noodles & Company is pushing hard on its turnaround strategy. Same-store sales rose 1.5 percent overall—1.5 percent at company-owned locations and 1.6 percent at franchised units—but still fell short of expectations. The modest growth was driven by a 4 percent increase in average check, offset by a 2.5 percent decline in traffic.
CEO Drew Madsen pointed to an unexpected drop in guest value perception after the March menu launch as a key factor, noting that customers are increasingly seeking affordability while competitors have ramped up discounting and promotions. To close the gap, Noodles rolled out its $9.95 Duos value platform—a small noodle bowl paired with a side—on July 30.
“Though our positive same-store sales in the second quarter outperformed many in the fast-casual segment, they were below our expectations. We have identified the challenges in the current consumer environment to improve our top-line performance and are moving quickly to respond to them,” Madsen said during Noodles’ Q2 earnings call.
Third-party delivery continues to be the brand’s strongest channel. Although growth in this segment slowed as Q2 progressed, it has recently regained traction. By daypart, dinner remains steady and continues to outperform the broader fast-casual market, while lunch has softened due to heightened price sensitivity during midday hours.
Noodles & Company readies three-pronged plan heading into Q3
With Q2 results highlighting both opportunities and challenges, Noodles & Company is sharpening its focus heading into the third quarter with a three-pronged strategy aimed at reigniting same-store sales growth.
The first pillar zeroes in on operations, introducing a new coaching initiative designed to better measure restaurant performance against brand standards. This includes tailored training plans at both the individual restaurant and systemwide levels, supported by six newly appointed “operations excellence coaches” who will work directly with general managers to elevate the guest experience.
The second focus is on value—a priority underscored by the recent launch of the Duos platform. Building on that momentum, the chain will roll out a limited-time Chili Garlic Ramen in the fourth quarter at a price point of $8.95.
The final element leans heavily into digital engagement. Company-owned web and app platforms saw a 2 percent year-over-year increase in traffic during Q2, while rewards program member check-ins rose 4 percent. Rewards members now account for 27 percent of all transactions, a sign that digital loyalty remains a powerful tool for deepening customer relationships and driving repeat visits—momentum the brand hopes to build on as the third quarter progresses.
Source: QSR