Jack in the Box to close up to 200 ‘underperforming’ locations

CNN - Apr 24th, 2025

Jack in the Box is set to close 10% of its locations and is considering selling its Del Taco brand as part of a significant restructuring. The fast-food chain plans to shut down 150 to 200 underperforming restaurants, with 80 to 120 closures expected by year-end, aiming to address its financial challenges. CEO Lance Tucker stated that these measures are intended to enhance cash flow and reduce $300 million in debt over the next two years, with the goal of achieving net positive unit growth. The company acquired Del Taco three years ago, but the venture has faced difficulties, including inflation and competition from major players like Taco Bell. As a result, Jack in the Box's financial performance has suffered, with a 4.4% drop in sales in the second quarter of 2025 and a stock price decline of 57% over the past year.

The broader implications of this development highlight the ongoing struggles within the fast-food industry as consumer spending decreases. While Jack in the Box faces more significant challenges, other chains like McDonald's and Chipotle have also reported slower growth, though Taco Bell anticipates an 8% sales increase driven by popular new menu items. The potential sale of Del Taco reflects strategic repositioning efforts by Jack in the Box to refocus on its core brand and stabilize its financial health. This move underscores the competitive pressures in the fast-food sector and the need for companies to adapt to changing market conditions to ensure long-term viability.

Inflation Consumer Spending Taco Bell Fast Food Industry Jack In The Box Del Taco Lance Tucker Restaurant Closures Debt Reduction

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RATING

6.8

Fair Story

Consider it well-founded

The article provides a timely and largely accurate overview of Jack in the Box's current strategic and financial challenges, supported by credible internal sources. It effectively communicates the company's decisions and the rationale behind them, making it relevant to readers interested in the fast-food industry and economic trends. However, the article could benefit from greater source diversity and transparency regarding specific financial figures, which would enhance its reliability and depth.

While the article presents a balanced view of the company's situation, it lacks perspectives from external stakeholders and industry experts, which could provide a more comprehensive understanding of the broader market context. Additionally, the article could increase its impact and engagement by exploring the potential implications of these strategic decisions on employment and local economies, as well as incorporating more interactive elements and diverse viewpoints.

Overall, the article is well-written and accessible, but it could further enhance its value by addressing these areas for improvement, providing readers with a more thorough and engaging analysis of Jack in the Box's strategic challenges and opportunities.

Accuracy

The story is largely accurate, with key claims supported by external sources. The announcement of closing 150 to 200 'underperforming' Jack in the Box locations is corroborated by multiple reports. The exploration of strategic alternatives for Del Taco is also confirmed, aligning with the CEO's statements about the potential sale due to underperformance and market challenges.

However, some specific figures, such as the exact percentage drop in stock price or the precise financial targets, are not directly verified in other sources. The story's claim about Jack in the Box's intention to pay off $300 million in debt is not explicitly mentioned in other reports, which slightly undermines the precision of the financial details presented.

Overall, the factual accuracy is strong, but the article could improve by providing more direct citations or references for specific financial figures and projections.

Balance

The article presents a balanced view of Jack in the Box's current situation, including both the challenges and the strategic responses being considered. It highlights the company's struggles with declining sales and competition, as well as the proactive measures being taken, such as closing underperforming locations and considering the sale of Del Taco.

However, the article could benefit from including perspectives from industry analysts or competitors to provide a broader context of the fast-food industry's current state. Additionally, while it mentions the struggles of other chains like McDonald's and Chipotle, it does not delve deeply into how these compare to Jack in the Box's situation, which could offer a more comprehensive view of the market dynamics.

Clarity

The article is well-structured and uses clear, concise language, making it easy for readers to follow the narrative. It logically presents the company's challenges, strategic decisions, and financial performance, allowing readers to understand the situation without needing additional context.

The use of direct quotes from the CEO helps to convey the company's perspective and intentions clearly. However, the article could enhance clarity by providing more background on the fast-food industry's current trends and challenges, which would help readers unfamiliar with the sector better grasp the context of Jack in the Box's decisions.

Source quality

The article relies primarily on statements from Jack in the Box's CEO and the company's pre-announced earnings report, which are credible sources for the company's strategic decisions and financial performance. However, there is a lack of diverse sources, such as independent analysts or industry experts, which could provide additional insights and validate the company's claims.

The reliance on internal sources means the article may not fully capture external perspectives or potential biases. Including more varied sources would enhance the reliability and depth of the reporting, offering readers a more rounded understanding of the situation.

Transparency

The article provides a clear summary of Jack in the Box's strategic decisions and financial performance, but it lacks transparency regarding the basis for some of its claims, particularly the financial figures. The absence of direct citations or references for specific data points, such as the $300 million debt target, makes it difficult for readers to verify these details independently.

While the CEO's statements are presented, the article does not explain the methodology behind the financial projections or the criteria for determining 'underperforming' locations. Greater transparency in these areas would improve the article's credibility and allow readers to better assess the validity of the claims made.