Red Lobster, a beloved seafood chain known for its iconic Cheddar Bay Biscuits and endless shrimp promotions, has officially declared bankruptcy after months of speculation and sudden restaurant closures. The company, which has been a staple in the seafood industry for nearly five decades, is now facing a tumultuous future as it navigates the aftermath of its financial downfall.
In a letter posted on social media, Red Lobster expressed gratitude to its loyal customers and reassured them that the chain was not going out of business. The company emphasized that filing for bankruptcy was a strategic move to restructure its business and cost structure in order to emerge as a stronger entity in the future. Red Lobster cited examples of other companies, such as Delta Airlines and Hertz, that successfully rebounded after filing for Chapter 11 bankruptcy.
The chain’s troubles can be traced back to a failed “Endless Shrimp” promotion in November 2023, which resulted in an $11 million loss for the company. The promotion, offering unlimited shrimp for $20, proved to be too popular and ultimately backfired on Red Lobster. As stores across the country began closing without warning and auctioning off their equipment, CEO Jonathan Tibus pointed fingers at former CEO Paul Kenny and Red Lobster’s seafood supplier, Thai Union, for their roles in the promotion’s failure.
Red Lobster is currently investigating the circumstances surrounding the decision to make the “Endless Shrimp” promotion permanent, rather than a limited-time offer. With Thai Union’s acquisition of Red Lobster in 2020, questions are now being raised about the influence the supplier had on the chain’s operations and decision-making processes. As Red Lobster faces this challenging chapter in its history, loyal customers are left wondering what the future holds for their favorite seafood destination.