Canadian restaurant franchisor MTY Food Group is set to close up to 50 underperforming Papa Murphy’s restaurants over the next six to nine months as part of a wider restructuring aimed at improving profitability across its corporate-operated portfolio.
The closures form part of a broader review that identified 68 underperforming corporate restaurants across MTY’s portfolio of more than 80 restaurant brands. The majority of those locations belong to Papa Murphy’s, reflecting the continued challenges facing the take-and-bake pizza chain in the U.S.
Speaking during MTY Food Group’s latest earnings call, President and CEO Eric Lefebvre said the company is taking decisive action to eliminate persistent losses while preserving stronger-performing assets. “Papa Murphy’s, certainly in the U.S., has been struggling more than our other brands as of recent,” Lefebvre said.
He added that the closures would be phased in carefully over the next six to nine months to minimize disruption to employees, franchisees and supply-chain partners. “We don’t want to create unnecessary disruption. We want to do this in an orderly fashion,” Lefebvre said.
MTY said the review focused exclusively on corporate-operated restaurants, not the broader franchised network. The identified stores have collectively generated losses exceeding US$10 million over the past year, prompting the company to accelerate its restructuring efforts.
While Papa Murphy’s accounts for the majority of the planned closures, Lefebvre acknowledged that a handful of other MTY brands are also undergoing operational reviews, although none face restructuring on the same scale.
The company expects the closures to strengthen margins and improve the quality of its corporate restaurant portfolio over time.
Papa Murphy’s has struggled to regain momentum since the pandemic despite its distinctive take-and-bake pizza concept, where customers purchase uncooked pizzas to bake at home.
Industry data shows the brand’s footprint has steadily contracted in recent years. According to its Franchise Disclosure Documents, the chain’s total restaurant count declined from 1,168 locations in 2023 to 1,014 locations by the end of 2025, with most of those reductions occurring within the franchised system. The latest closures will largely affect the remaining corporate-operated restaurants acquired by MTY during its turnaround efforts.
Despite the corporate closures, Papa Murphy’s remains a predominantly franchised brand, with franchise operators continuing to account for the overwhelming majority of its restaurants.
MTY Food Group acquired Papa Murphy’s in 2019 in a deal valued at approximately US$190 million, adding one of North America’s largest take-and-bake pizza brands to its growing restaurant portfolio. Today, MTY owns or franchises more than 80 restaurant brands across North America and international markets, including Cold Stone Creamery, Wetzel’s Pretzels, Pinkberry, Baja Fresh, Famous Dave’s, TCBY, Planet Smoothie and several others.
The company has consistently emphasized that franchising remains its primary long-term growth model, with corporate ownership used selectively to support brand development, operational improvements and market testing.
The Papa Murphy’s restructuring comes as restaurant operators across North America continue to grapple with softer consumer spending, rising labour costs and persistent inflationary pressures.
Rather than pursuing unit growth at any cost, MTY said its immediate priority is improving the profitability and health of its existing portfolio.
The first wave of Papa Murphy’s closures has already begun, with the remaining affected locations expected to shut over the coming six to nine months as MTY completes its operational review.
