Denny's plans to close 150 restaurants by the end of 2025

Denny's plans to close 150 stores over the next year, and the 71-year-old diner brand is considering a big adjustment to its 24-hour operation.

Denny's plans to close 50 sites by the end of 2024, with the remaining 100 closing in 2025, according to an earnings call held Tuesday. That equates to a tenth of its restaurants, leaving 1,375 when completed. A particular list of restaurant closures was not immediately disclosed.

According to Stephen Dunn, Denny's executive vice president and chief global development officer, several of the restaurants are no longer in desirable locations.

“Some of these restaurants can be very old,” Dunn said during the investor meeting. “You think of a 70-year-old plus brand. We have a lot of restaurants that have been out there for a very long time.”

Others observed traffic patterns during the pandemic that have yet to reverse, he stated.

Other modifications at Denny's include a reduced menu of 46 options from 97. The restaurant also discovered that cash-strapped adults were increasingly eating off its kids' menu to save money.

Denny's (DENN) stock plunged 17% on Tuesday after earnings fell short of analysts' forecasts. The stock is down 50% year to date.

Denny's did, however, point to some bright spots, such as a discount menu that increased sales in the most recent quarter and boosting sales of its delivery-only brands such as Banda Burrito.