Chili’s led a casual-dining comeback in 2025. | Photo: Shutterstock
Full-service dining is alive and well.
If there’s one thing to take away from 2025 for sit-down dining operators, it’s that.
In a year in which consumers grew increasingly fed up with inflation, full-service restaurant chains broke through with an appealing proposition: A full meal, a drink or two, plus friendly service, for a reasonable price.
That equation sparked a renaissance of sorts for full-service chains, led by the high-flying Chili’s, which put in a second straight year of jaw-dropping growth.
But 2025 wasn’t without its warts. A steady drumbeat of full-service bankruptcies continued, and a turnaround at Cracker Barrel came to a screeching halt following its logo blowup.
Read on to see the high- and lowlights from a memorable year in full-service dining.
It was Chili’s year.
The resurgent bar and grill chain drew in consumers with its $10.99 3 for Me value meals and its viral Triple Dipper appetizer platter. It also re-launched its ribs and frozen margaritas and continued to improve its operations, leaving customers more satisfied than ever despite the busier restaurants.
Through the first three quarters of 2025, Chili’s reeled off same-store sales growth of 31.6%, 24% and 21%. But maybe the best marker of the chain’s success was the number of copycats it inspired. BJ’s, Red Robin and others launched combo meals reminiscent of the 3 for Me; Applebee’s promoted a three-part appetizer of its own; and chains from across the industry pursued their own version of a “cheese pull” popularized by Chili’s mozzarella sticks.
Outdoing this performance next year will be a tall task for Chili’s. But there’s no doubt that it has reclaimed its spot in America’s collective unconscious.
But there were many winners.
Remove Chili’s from the equation, and it was still a strong year for full-service brands. Among publicly traded restaurant companies, FSR chains consistently outpaced the industry on same-store sales and traffic. Texas Roadhouse continued its own torrid growth, Olive Garden and First Watch impressed, and Applebee’s began to turn things around. The Cheesecake Factory was its usual consistent self, and BJ’s improved noticeably under new leadership.
Why? The consensus was that choosy, price-conscious consumers realized they could get the most bang for their buck in full service. A flood of value promotions, a la Chili’s 3 for Me, certainly helped.
“What’s happening right now is that consumers are figuring out that casual dining is a great value and so they’re coming to casual dining more,” said Olive Garden CEO Rick Cardenas in June. “Consumers want to go out and spend their hard-earned money, and we think we’re taking some wallet share from fast food and fast casual.”
And some losers.
For the second straight year, there was a wave of bankruptcies in full service, most notably Hooters, one of the biggest restaurant bankruptcies in years.
Others to succumb to Chapter 11 included Bravo/Brio, Bar Louie and Bertucci’s. There were even a couple Chapter 7 filings, at Iron Hill Brewery and Opa, a small Greek chain.
Most of them blamed a combination of pandemic challenges and the current economy, which has dampened restaurant demand across the industry and made it more difficult for companies to pay rent and debt.
This trend was not limited to full-service dining, though the segment was particularly hard hit by bankruptcies.
And plenty of turnarounds.
Outback Steakhouse parent Bloomin’ Brands, Red Robin, Denny’s, Cracker Barrel and BJ’s are all in various stages of a plan to return to growth and relevance. Most have been stagnant, overbuilt or just fallen out of favor with consumers over the years.
One common theme among these turnarounds is a greater focus on value. Each of the above brands rolled out some sort of low-priced, bundled offering this year, from Red Robin’s $10 Big Yummm meal to Outback’s Aussie 3-Course meal starting at $14.99. They have proven to be a quick way to jump-start traffic.
There has also been a big emphasis on simplifying operations to make employees’ jobs easier and customers more satisfied. These efforts remain a work in progress, but have shown good results at places like BJ’s, which has worked to do away with extraneous steps for employees.
And one big meltdown.
Cracker Barrel was about a year and a half into its three-year, $750 million transformation plan in August when it quietly unveiled a new logo. The logo did not include the brand’s old-timer mascot–Uncle Herschel–or its titular barrel. The new look began to spread on social media, and consumers, particularly conservatives, weren’t too pleased. (It was later determined that much of the backlash was driven by bot accounts.)
The problem snowballed out of control for Cracker Barrel, which quickly ditched the logo, along with plans to remodel its stores, and insisted that it was still the same old all-American restaurant chain that its customers know and love.
But the damage had been done. Cracker Barrel is still battling traffic declines caused by the PR nightmare, and is going back to square one with its turnaround plan. The focus now is better food and operations, with the goal of winning back customers one visit at a time.
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