Red Lobster CEO Warns More Closures After 130 Locations Shuttered

Damola Adamolekun, who became Red Lobster’s CEO in August 2024 after leading a restructuring at P.F. Chang’s, told the Wall Street Journal the chain is reviewing its real estate and leases and could close “dozens” more restaurants after roughly 130 sites were shuttered during the May 2024 bankruptcy. At the end of 2024 Red Lobster operated about 518 U.S. restaurants, meaning the bankruptcy cuts removed roughly one in five locations.

Adamolekun said visits have risen and sales are up about 10% from last year, but sales have not returned to pre-bankruptcy levels and many restaurants need upgrades. “There’s a lot of positive signs, but we inherited a very damaged brand, so there’s still work to do to repair all of that,” he told the Wall Street Journal. National Today quoted Adamolekun as saying, “We must still slim down.”

Company officials and people familiar with internal discussions told the Journal the optimal footprint would be “dozens fewer restaurants” so management can concentrate investment in higher-performing sites. That plan runs into a structural obstacle: Red Lobster no longer owns most of its real estate after a 2014 sale-leaseback to Golden Gate Capital for $1.5 billion, and some leases cover multiple restaurants, complicating the ability to close underperforming units without wider contract exposure.

Operational moves since Adamolekun’s hiring include menu and marketing changes intended to win back guests. RestaurantBusinessOnline reported the chain introduced happy hour, brought back hush puppies, and added seafood boils last June that proved popular enough to become a permanent menu item. Those product and traffic gains, however, have not erased legacy financial pressures tied to real estate and past promotions.

The company has also taken cost actions at the corporate level and across supply chains. Fox Business and Journal reporting say Red Lobster cut roughly 10% of its corporate staff in recent months and is negotiating with seafood vendors after tariffs pushed up the cost of imported seafood. Multiple outlets cited the prior “endless shrimp” promotion, originally priced at $20, as a driver of losses that contributed to the May 2024 bankruptcy.

Post-bankruptcy ownership and capital details vary by account. RestaurantBusinessOnline reported Red Lobster was acquired out of bankruptcy by Fortress Capital Management, which it said injected $70 million and installed Adamolekun. Fox Business included a photo caption referencing Fortress Investment Group, and National Today also named Fortress Investment Group as the buyer. Company confirmation of the acquirer’s legal name, the $70 million figure, and any targeted closure list has not been published.