Hooters servers in sexy getups have traditionally been the main draw for the restaurant/sports bar/chicken wing chain, but the only thing that company execs have had their eyes on recently are the firm's financials—and they don't look good. Sources tell Bloomberg that the company is collaborating with creditors and legal on a business restructuring path that will lead it straight to a bankruptcy filing, probably within a couple of months. The restaurant chain is said to have teamed up with the Ropes & Gray law firm and boutique company Accordion Partners to suss out its debt load and prep the filing, though Bloomberg's sources say plans aren't final.
The chain has struggled for years with plummeting sales and issues paying its bills: From 2018 to 2023, systemwide Hooters sales across the country fell almost 15%, and in 2024, the company took about four times longer than the average restaurant chain to pay its vendors, per Restaurant Business. Last year, Hooters attempted to wrangle the money it owed, a hefty $300 million in unpaid bonds, partly by shuttering 40 or so "underperforming" locations nationwide, per the Independent.
"Its problems reflect a broader struggle for the bar and grill segment, which has been hit hard by rising costs and a shift in consumer demand toward quick-service and fast-casual concepts," notes Restaurant Business. The Independent takes a somewhat optimistic view, however, pointing out that if Hooters is able to restructure things as well as Red Lobster did when it filed for Chapter 11 bankruptcy protection last spring, "the company may come out stronger on the other side." Indeed, things are slowly starting to look up for the seafood eatery chain already. (More Hooters stories.)
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