The convenience of grabbing a fresh, customized pizza to bake in the comfort of your own oven has long been Papa Murphy’s signature appeal. However, the beloved take-and-bake pioneer is facing a major wave of closures. Its parent company, MTY Food Group, recently announced plans to shutter up to 50 underperforming, corporate-owned Papa Murphy’s locations across the United States. This decision is part of a broader corporate restructuring effort that will result in the closure of 68 restaurants across MTY’s diverse portfolio, which includes household names like Wetzel’s Pretzels and Cold Stone Creamery. While other brands will feel a minor impact, Papa Murphy’s is slated to bear the heaviest burden of these closures, representing a significant shift in the brand’s physical footprint.
This difficult decision comes at a time when the entire restaurant industry is navigating a storm of economic challenges. Household budgets are being squeezed by soaring food prices and stubborn inflation, forcing consumers to think twice about their dining spend. At the same time, dining habits have shifted heavily toward delivery apps and quick-service drive-thrus, leaving traditional takeout models struggling to compete. This economic reality has spared few; major industry giants like Wendy’s, Papa Johns, and Pizza Hut have similarly had to scale back, closing underperforming stores to safeguard their bottom lines. For Papa Murphy’s, the financial toll of keeping these struggling locations afloat simply became too heavy of a burden to bear.
During a recent earnings call, MTY Group’s CEO and President, Eric Lefebvre, candidly shared the harsh financial realities driving this decision. He revealed that the 68 targeted locations had collectively drained more than $10 million in losses over the past year alone, with performance steadily declining. Lefebvre acknowledged that while saying goodbye to these locations hurts their overall store count in the short term, prioritizing long-term business health is the necessary path forward. He noted that Papa Murphy’s has experienced much deeper struggles than MTY’s other brands, prompting this aggressive intervention to plug the financial drain and allow the company to reinvest in healthier, high-performing locations.
While MTY Group has opted not to publish an exact address list of the affected locations, the company did provide clues by confirming that these closures will almost exclusively target company-owned stores rather than franchised ones. Looking at the company’s recent franchise disclosure documents, the distribution of these corporate-owned stores points to which states will likely feel the greatest impact. Out of 49 corporate locations operating at the end of last year, Tennessee held the largest share with 15 stores, followed by Indiana with eight, and North Carolina with seven. Other states facing potential losses include Michigan, Georgia, Missouri, Alabama, Arkansas, Minnesota, and Washington.
The upcoming closures mark a stark reversal of a recent strategy by MTY Group to rescue struggling franchises. Over the last two years, the parent company aggressively stepped in to buy back failing franchised locations, hoping to turn them around under corporate management. This rescue mission saw their corporate-owned store count skyrocket from just eight locations in late 2023 to nearly 50 by the end of 2025. Unfortunately, this hands-on intervention did not yield the hoped-for recovery. Instead, it concentrated the brand’s financial losses directly onto its own balance sheet, shrinking the overall Papa Murphy’s footprint from 1,168 total locations in 2023 to just over a thousand by the end of last year.
For loyal customers worried about their local spot, the transition will not happen overnight. MTY Group plans to phase out the targeted stores gradually over the next six to nine months, a timeline designed to responsibly manage lease negotiations, liquidate supply chains, and help affected employees transition. The initial wave of closures began in mid-July, and the company has left the door open for further adjustments, including potential sales or additional closures, depending on how the market behaves. Ultimately, while it is painful to see local storefronts darken, Papa Murphy’s is betting on this streamlined approach to secure its future, ensuring that the brand can continue serving up its signature fresh pizzas for years to come.
