Pizza Giant Bleeds Cash, Slams Doors

Pepperoni pizza slice on a paper plate over an American flag — PIZZA GIANT IN TROUBLE

One of America’s biggest take-and-bake pizza chains is closing up to 50 stores after a costly, failed turnaround experiment that burned through millions and still could not stop sales from sliding.

Story Snapshot

MTY Food Group will close 68 money-losing corporate restaurants, including up to 50 Papa Murphy’s locations.
The targeted stores lost more than $10 million over the past year, even after a turnaround push.
Many closing Papa Murphy’s shops were once franchise stores that MTY took over and tried to fix.
The cuts show how rising costs, weak traffic, and bad incentives can wreck a chain’s turnaround plan.

The Closures: What MTY Is Shutting Down And Why It Matters

MTY Food Group, a large Canadian restaurant owner, is closing 68 corporate-run stores over the next six to nine months. Up to 50 of those locations are Papa Murphy’s, the take-and-bake pizza chain known for selling pies you bake at home.

MTY’s chief executive officer, Eric Lefebvre, told investors that these restaurants lost more than $10 million in the last 12 months and that their performance “for the most part” continued to worsen.

Papa Murphy’s to close 50 restaurants over declining sales https://t.co/VxO3U513jo

— KFOR (@kfor) July 14, 2026

The decision hits Papa Murphy’s hard because these closures follow years of shrinkage. Reporting shows the brand shut 43 locations in 2023 and about 100 more in 2024, mostly franchise units.

Now MTY is cutting deep into the corporate side. Lefebvre said Papa Murphy’s “is currently suffering a little bit more” than other brands in a very tough pizza market, and the company needs to stop the bleeding and focus on stores that still make money.

From Franchise To Corporate: A Turnaround That Backfired

MTY bought Papa Murphy’s in 2019 for about 190 million dollars, pitching the deal as a turnaround play. In recent years, MTY took back clusters of franchise locations and converted them into corporate-run stores, hoping that central control, new systems, and shared marketing would revive sagging sales.

Lefebvre said MTY repossessed three such groups of stores that it believed it could put “on better footing.” Instead, most of those conversions are now on the chopping block.

MTY has openly said that 45 to 50 of the shuttered locations are Papa Murphy’s former franchise shops that became corporate units as part of this turnaround effort. Those stores did not respond the way management hoped.

The corporate segment, which includes Papa Murphy’s, saw profit plunge from 11.3 million dollars to 5.7 million dollars, while revenue fell 15 percent to 111.7 million dollars.

Same-store sales dropped by 2.1 percent across the group, with negative results in both the United States and Canada. That is not the picture results-first investors want to see after a high-priced acquisition.

The Cost Of Cutting Losses And The Pressure On The Pizza Model

Closing 68 restaurants is not cheap. MTY expects to spend $ 10- $12 million upfront to terminate leases and close these doors. From a business-first view, this is a painful but rational move: spend once to stop yearly losses that already top 10 million dollars.

Lefebvre framed the closures as a way to “reduce losses and concentrate resources on locations with stronger return potential,” a message that fits a focus on efficiency and discipline.

One of the largest pizza chains in the country is preparing to close up to 50 Papa Murphy’s locations as its parent company, MTY Food Group, eliminates underperforming restaurants while it works through a “challenging period” for the business. https://t.co/gxZrOff70F

— KIRO Newsradio 97.3 FM🎙 (@KIRONewsradio) July 13, 2026

These failures are not happening in a vacuum. The quick-service restaurant sector faces a nasty mix of pressures: heavy debt taken on during the pandemic years, high food and labor costs that will not drop, and softer customer traffic as families watch every dollar.

Research shows that restaurant chains fail at rates similar to those of independent spots over time, and many turnarounds collapse because owners misjudge operations and people issues, not just marketing slogans. Papa Murphy’s now looks like another case in which a distant acquirer underestimated local realities.

What This Signals For Papa Murphy’s And Other Chains

The closures raise sharp questions for Papa Murphy’s future. The brand’s footprint has already shrunk by nearly 150 locations in just a couple of years, and the latest cuts hit some of the stores MTY thought it could save.

Lefebvre still talks about long-term “viability” and says he does not expect closures on the same large scale going forward. That optimism will need to be backed by hard numbers: stable same-store sales, real profit improvements, and less reliance on rosy forecasts.

For other chains, the warning is clear. When a big company takes over a troubled brand, buying out franchisees and pulling stores into corporate control can sound neat on a PowerPoint slide. But that move can strip away the local owner hustle that kept marginal units alive.

It can also lock the acquirer into expensive leases and payrolls it cannot flex when times get rough. The Papa Murphy’s story shows how fast a franchise-to-corporate “fix” can turn into a costly retreat when sales slump and the math no longer works.