Major pizza chain suffers major bankruptcy in key market

It’s never been easy going for restaurant operators, given that an estimated 20% of restaurants close their doors within the first year and up to half are shuttered by the five-year mark.

But it’s been particularly challenging for the dining industry since Covid lockdowns forced restaurants and stores to shut down, prompting a wave of permanent closures by those with limited financial wiggle room. An estimated 60% of stores closed during Covid never reopened.

Those who have survived haven’t had an easy time of it, either, over the past few years. Despite less competition, inflation has taken a stiff toll, forcing restaurants to cut their profits or, in many cases, increase the prices they charge for food and drinks.

The situation has made it particularly tough for those with small margins and heavy debt, especially quick-service restaurants (QSR) and casual dining locations catering to cash-strapped customers, such as pizzerias.

As a result, some restaurant chains, including QSR pizza chains’ Domino’s and Little Caesars, have closed locations, while casual dining chains Red Lobster and TGI Fridays declared bankruptcy in 2024. The industry’s problems aren’t limited to the United States either. Surging inflation is also taking a toll on the industry in the United Kingdom, where the consumer price index showed inflation rose 3.8% year over year in August, crimping wallets.

In early 2025, pizza chain Papa John’s closed 74 underperforming U.K. locations, reducing its footprint to 457 stores from 524. In 2024, Whitbread said it would close over 200 restaurants. And now, the situation has claimed another major victim: Pizza Hut franchisee DC London Pie entered administration—the U.K.’s version of bankruptcy—on Oct. 20.

68 Pizza Hut locations to close amid collapse

Pizza is a big business, with pizzerias generating nearly $45 billion in revenue in 2025, according to IBISWorld. Market.us estimates that worldwide pizza sales eclipsed $152 billion in 2024.

It doesn’t matter if we’re talking deep dish or thin crust (the Chicago versus New York-style debate rages on), pepperoni or veggie; people are passionate about their pizza and often loyal to their pizzerias.

As a result, many large pizza chains have emerged over the years, including Pizza Hut, owned by Yum! Brands, Domino’s Pizza (DPZ), and Papa John’s (PZZA).

Biggest pizza chains by sales worldwide (2024)

• Domino’s Pizza*: $19.1 billion.
• Pizza Hut*: $13.1 billion.
• Papa John’s*: $4.85 billion.
• Little Caesars**: $3.5 billion.
• Marco’s Pizza**: ~$1 billion.
• Source: *10-K SEC filings; **QSR.

Pizza Hut, founded in 1958, used to be the biggest global pizza chain, but it lost its sales crown to Domino’s in 2017. In 2024, Pizza Hut operated 20,225 restaurants, with 68% of them located overseas, including hundreds of locations in the United Kingdom, where it opened its first location in 1973.

Unfortunately, Pizza Hut franchises in the U.K. have struggled amid heavy competition and higher prices, forcing major changes in 2025.

In January, Heart with Smart, the 139-store franchisee of Pizza Hut’s dine-in U.K. business, entered administration with 50 million Pounds in debt, and was sold in a pre-packaged deal to U.S. equity firm Directional Capital’s DC London Pie.

That deal, however, didn’t pan out.

More Bankruptcy:

• Beer brand and brewery files Chapter 11 bankruptcy
• Italian chain closed most restaurants in Chapter 11 bankruptcy
• Popular healthcare retail chain files for Chapter 11 bankruptcy

On Oct. 20, DC London Pie entered administration, naming FTI Consulting LLP’s Matthew Boyd Callaghan, Lindsay Kate Hallam and Christopher Jon Bennett as joint administrators. The administrators, appointed to protect creditors, announced yet another pre-packaged deal to sell 64 Pizza Hut stores to Yum! Brands.

“This targeted acquisition aims to safeguard our guest experience and protect jobs where possible,” said Nicolas Burquier, Yum! Brands’ managing director for Pizza Hut Europe and Canada.

DC London Pie’s remaining 68 stores and 11 distribution sites that were not purchased by Yum! Brands are set to close, potentially resulting in 1,210 lost jobs.

Pizza Hut U.K. timeline

• 1973: First U.K. Pizza Hut opens
• 1980: Pan pizza is launched.
• 1987: A new store was opened weekly.
• 1995: Stuffed-crust pizza launches.
• 1999: 400 restaurants, employing 14,000 people.
• 2006: 697 restaurants.
• January 2025: The UK dine-in business, owned by franchisee Heart with Smart, is sold to US private equity firm Directional Capital’s DC London Pie.
• October 2025: DC London Pie appoints FTI Consulting as administrators. Yum! Brands acquires 64 stores; 68 stores will close.
• Source: Pizza Hut U.K.; FTI Consulting

Cash-strapped consumers take toll on pizza industry

The closures aren’t too surprising, given they mark the latest in a string of global closures announced across pizza chains.

In January, bankrupt Pizza Hut franchisee EYM Pizza L.P. sold 77 restaurants in Georgia, Illinois, South Carolina, and Wisconsin to six separate bidders.

In 2024, Domino’s Pizza closed 259 locations, including 253 overseas. Papa John’s closed 186 locations worldwide last year, including 155 international stores.

MOD Pizza closed27 locations in 11 U.S. states this year. Even local pizzerias in the U.S., such as Gina Maria’s Pizza, a four-store pizza chain in the suburbs of Minnesota, have closed their doors. Another, Mama’s Pizza & Heros, has closed two of its four stores over the past two years.

Those closures are at least partly due to pressure on low and middle-income customers, who tend to favor the lower prices and convenience of quick-service restaurants.

“Our comp could be pressured by the macro environment in the U.S., which we have seen intensify across the restaurant industry at the start of our [fiscal] fourth quarter,” said Domino’s Pizza chief financial officer Sandeep Reddy on the company’s Oct. 14 earnings call. “We’ve definitely been seeing a slowing across restaurant industry sales to start our fourth quarter.”

Reddy’s comments echo those of Papa John’s CFO Ravi Thanawala, who said in August:

We’ve seen a more cautious consumer.

Papa John’s CFO Ravi Thanawala.

Pizza Hut owner Yum! Brands is similarly navigating shifts in consumer spending.

“I know the lower-income consumers are pulling back,” said Yum! Brands CEO David Gibbs during its earnings call on Aug. 5.

The dynamic may not get much easier for restaurants, given rising unemployment and recent increases in inflation. U.S. unemployment was 4.3% in August, the highest since 2001, and consumer price index inflation was 2.9%, up from 2.3% in April.

Related: MOD, Little Caesars, and more pizza chains close 100s of restaurants

Here’s the complete list of the 68 Pizza Hut and 11 delivery locations set to close in the U.K.: