Jack in the Box Is Closing up to 200 Locations and Contemplating Del Taco Sell-Off in a Shocking Move

Jack in the Box has just made a shocking announcement. The popular West Coast fast-food chain has not only announced the closure of up to 200 underperforming locations, but its parent company is contemplating the sell-off of the equally popular fast-food chain, Del Taco. Let’s take a look at what we know about this latest announcement.

Jack in the Box Is Trying To Streamline Operations

In a press release, Jack in the Box revealed that it has decided to close between 150 and 200 locations because it wants to streamline its operations while improving its “long-term financial performance.”

“In my time thus far as CEO, I have worked quickly with our teams to conclude that Jack in the Box operates at its best, and maximizes shareholder return potential, within a simplified and asset-light business model,” said Lance Tucker, who was recently named CEO of Jack in the Box, in a statement accompanying the press release. “Our actions today focus on three main areas: addressing our balance sheet to accelerate cash flow and pay down debt, while preserving growth-oriented capital investments related to technology and restaurant reimage; closing underperforming restaurants to position ourselves for consistent net unit growth and competitive unit economics; and, an overall return to simplicity for the Jack in the Box business model and investor story.”

The company’s block closure program is called “JACK on Track,” and it is expected to result in the closure of 150 to 200 underperforming restaurants, the bulk of which have been in the system for over 30 years. The program will include about 80 to 120 restaurant closures between now and Dec. 31, 2025, with the other underperforming restaurants closing later based on their franchise agreement termination dates.

The JACK on Track program will also explore the potential sale of Del Taco, which is owned by the same parent company as Jack in the Box. It is unclear when a decision on Del Taco’s fate will be rendered.

Chicago-Area Openings

Meanwhile, after numerous delays and false alarms, NBC 5 Chicago claims that up to 10 stores will open over the next two years in Chicago, Countryside, Tinley Park, New Lenox, Plainfield, Naperville, Carol Stream, and Lake in the Hills. The first suburban facility is slated to debut in July 2025.

The restaurant had previously announced that the Chicago locations would be open 24 hours a day, offer dine-in, drive-thru, and mobile ordering, and serve the chain’s well-known late-night “24/7 cravable menu.” Other popular Jack in the Box menu items include breakfast, milkshakes, chicken sandwiches, tacos, and hamburgers.

However, when NBC 5 Chicago requested clarification, Jack in the Box management declined to comment.

The iconic fast-food chain initially hinted about an expansion to the Windy City during its Q3 results call last August. The chain has returned to Chicago for the first time in 40 years.

This research suggests that, following a period of contraction, the fast-food industry is expanding again.

CMO Ryan Ostrom attributed this achievement to marketing initiatives and social media’s capacity to build brand awareness, which is allowing the fast-food industry to expand into new markets. During the company’s January “Investor Day” presentation last year, Ostrom told analysts: “We have 80% brand awareness. The excitement we’re seeing across the United States about our brand, the demand in the U.S., and now socially, is something I’ve never seen.”

“I’m not sure I’m knowledgeable of any other restaurant chains that have such scale and proof of concept that still has such tremendous white space across the United States for growth,” said Darin Harris — then-CEO of Jack in the Box, who took over in 2020 following dissatisfaction among franchisees — at the time.