IHOP and Applebee’s Owner Slashes Jobs After Sales Slump

Earlier this year, Eat This, Not That! reported data from Yahoo Finance using information from Bloomberg highlighting the growth – and decline — of the most popular sit-down chains throughout 2024. While several restaurants, including Chili's, Texas Roadhouse, and LongHorn, experienced a growth in sales, two restaurants failed to grow: IHOP and Applebee's. This week, the parent company of the two announced massive layoffs. Here is what you need to know about it.

Dine Brands Laid Off 9% of Its Almost 600-Employee Workforce

Last week, Dine Brands, the company behind IHOP, Applebee's, and Fuzzy's Taco Shop, announced they had laid off 9% of its almost 600-employee workforce. Those impacted worked out of the corporate headquarters in Pasadena, California.

It's Part of a "Strategic Plan to Better Align with Current Market Conditions"

"Dine Brands announced a reduction in its workforce as part of a strategic plan to better align with current market conditions. This decision was not made lightly. We deeply value the contributions of all our team members and are committed to supporting those affected during this transition," Vice President of Human Resources Christie Cook told Nation's Restaurant News in a statement.

The Layoffs Impacted People Across Various Departments

"The layoffs involved about 9% of our team members across various departments, brand teams, and offices. Affected team members will receive severance packages, outplacement services, and other support to assist them in their career transitions," she continued.

They Are Focused on "Sustainable Growth and Success"

"We remain focused on our long-term vision driving sustainable growth and success. We are grateful for the dedication and hard work of our team members and will continue to prioritize their well-being," the statement concluded.

IHOP Sales Dropped 1.3% in Q4

In Q4, IHOP dropped 1.3% in Q4. "What we're seeing is a very promotion-driven environment right now and a lot of 'noise' for consumers to sort through when there are so many brands and categories offering so many promotions and deals, so we have to make sure we are sharp in the right promotion," Chief Executive Officer John Peyton said during a call. "We know we're capable of more and while the underlying strength of our business provides assurance of resilience through market cycles, we are diligently working to identify and address the missing ingredients in our strategy to refine our offerings and move forward."

Applebees Sales Dropped 3.7%

Applebee's dropped 3.7% in the same quarter. The restaurant plans on leaning into its new NFL partnership to drive traffic and is modifying its menu items. "We're applying our learnings with a shift to more full meal value offers and will continue to evolve our value propositions to keep our guests engaged," Peyton added during the same call. "We need to be more consistent with our promotions, making sure they perform more often or all the time and not as hit or misses we had during the quarter."