Shoppers are apparently taking detours to casual-dining chains like Applebee’s and Chili’s this yr. | Photograph: Shutterstock.
Final yr couldn’t have been a lot worse for the full-service sector. A few of the nation’s largest and most venerable chains declared chapter and closed items, together with Pink Lobster, TGI Fridays and, early this yr, Hooters of America.
As my colleague Joe Guszkowski has famous, the sector shed areas final yr, thanks largely to these filings and numerous struggles.
It continued a long-term development. Since I began overlaying this business practically 20 years in the past, the casual-dining sector has been in some type of disaster. The chains have been shedding site visitors, whilst new ideas emerged and constructed new areas.
It’s wonderful how issues can change.
On Wednesday, Chili’s reported 24% same-store gross sales progress. On a two-year foundation, that key metric is up 39%. That’s on par with the insane degree reported final yr by the rooster wing chain Wingstop in 2024. In a string of unbelievable gross sales outcomes from the chain, that one is perhaps essentially the most spectacular.
All people’s avoiding quick meals and simply heading to Chili’s apparently.
— Jonathan Maze (@jonathanmaze) August 13, 2025
But it surely isn’t simply Chili’s. Applebee’s same-store gross sales rose practically 5% within the second quarter, due to an improved 2-for-$25 promotion. BJ’s Eating places same-store gross sales rose 2.9%, with enhancing earnings. Gross sales rose 6.9% at Olive Backyard. One other stalwart, Texas Roadhouse, reported same-store gross sales up 5.8%.
On the personal aspect, there are robust indications that Pink Lobster is surging this yr behind the success of its CEO-led advertising and marketing and seafood boils.
One key exception: Pink Robin, which had some momentum early within the yr however noticed gross sales decline extra not too long ago. There are all the time exceptions. Like Taco Bell within the fast-food area and Potbelly in fast-casual.
The efficiency is especially notable as a result of it comes within the backdrop of a troublesome general business setting that’s purported to create issues for casual-dining manufacturers. Each quick-service chains and fast-casual chains are reporting a string of weak gross sales outcomes, resulting in company layoffs, CEO merry-go-rounds and investor uprisings.
Publicly traded casual-dining chains outperformed quick-service manufacturers within the first quarter for the primary time in current reminiscence, outdoors the pandemic restoration interval. They’re prone to outperform fast-casual manufacturers within the second quarter. When you would have advised me {that a} yr in the past I might have laughed on the ridiculousness of that joke.
Informal-dining just isn’t purported to be doing this, not in an setting through which customers are reducing again on spending.
And, by the way in which, should you assume this cutback is simply restricted to low-income diners you’re not paying sufficient consideration to the outcomes of chains like Cava and Sweetgreen, neither of that are precisely flush with low-income diners. Shopper confidence took successful and there are extra job considerations than there have been in 5 years.
Shoppers in environments like this are purported to “commerce down,” or shift spending from informal eating to quick informal or to quick meals, as a result of these choices are cheaper. However customers now not assume they’re the cheaper choices.
Shoppers are managing their spending. They’re lowering their visits or shopping for inexpensive objects or, continuously, skipping breakfast. However they’re visiting when the urge hits them, and so they’re getting what they need after they do go. So that they’ll flock to McDonald’s for Minecraft merch or to Wendy’s to get some model of a Krabby Patty.
However after social media fueled shopper anger over costs, many customers realized they might go to one in every of these informal eating chains and get much more for his or her cash, a lesson Chili’s taught the world final yr. And after a number of years through which chains closed areas or shut down altogether, there may be much less competitors for these diners.
How lengthy will this final? That’s laborious to inform. And as Pink Robin demonstrated, slightly momentum can go away shortly. However casual-dining chains have their greatest alternative to take share within the restaurant enterprise than they’ve had in a very long time.
