The casual-dining comeback starts at the top

From a bird’s-eye view, the casual-dining segment had a nice year in 2025. Total sales among Technomic’s Top 500 casual-dining chains rose 2.9%, to $67.7 billion.

The growth was roughly in line with inflation, but still, it was a marked improvement over 2024, when sales rose just 1.5%. And it came amid a period of extended economic uncertainty and consumer unease.

It was good enough to give rise to some murmurs: Is casual dining back?

Mixed growth trends

Well, yes and no.

A closer look at the numbers shows that the bulk of casual-dining’s growth last year came from just a few very large chains, with one red-hot brand in particular carrying most of the load.

In terms of total dollars, Top 500 casual-dining sales grew by about $1.9 billion in 2025. Almost all of that—$1.7 billion—came from Texas Roadhouse, Chili’s Grill and Bar and Olive Garden, the three largest casual-dining chains in the U.S. by sales.

And most of that growth was from Chili’s, which added nearly $1 billion in total sales by itself in 2025, an increase of 21% year over year.

So it was a year of winners and losers in casual dining. Choosy consumers rallied around some brands more than others. And Chili’s was definitely one of those brands.

The 1,200-unit chain had a tremendous year, continuing a turnaround that began to take shape in mid-2024. Its 31.6% year over year same-store sales growth in the first quarter stands as one of the best performances by a publicly traded restaurant chain in at least two decades. In the next three quarters, it posted same-store sales of 24%, 21.4% and 8.6%, which lapped a 31.4% increase the year prior.

The hot streak has been driven by better operations, savvy marketing, improvements to core menu items and a big focus on value. The brand has also gotten some help from social media, where its Triple Dipper appetizer platter went viral in the spring of 2024 and hasn’t stopped selling since.

All of that has helped bring new customers into Chili’s restaurants and keep them coming back. It was the ninth-fastest-growing casual-dining chain in the U.S. by sales last year, even though it didn’t add any locations. (In fact, it closed a few.)

Focus on basics

The Chili’s renaissance, as well as the consistent success of Texas Roadhouse and Olive Garden, has helped create a new playbook for casual dining: Focus on the basics of food and service and good things tend to follow.

It’s not all that new or novel, really. But that philosophy got lost a bit during the pandemic, when many full-service chains had to rethink their whole operations to survive. Delivery, takeout and technology became priorities. Consumers stayed home. Only in the past year or two has the full-service ecosystem had a chance to return to its natural state.

“Casual dining in general is starting to understand what consumers are looking for,” said Joe Pawlak, managing principal at Technomic. “At the end of the day, consumers still want experience. They still want to have quality food at a reasonable price. And so now chains have gone back to what they do best.”

Indeed, brands in search of a Chili’s-like turnaround are investing in foundational elements like better ingredients, more hands-on service, and refreshed restaurants.

BJ’s Restaurants, for instance, has made numerous changes to its menu over the past year, including revamping its pizza recipe and turning its signature Pizookie dessert into a social media star, with a new flavor arriving each season. It has also cleaned up its operations, removing unnecessary steps for servers and improving its training for hourly staff.

Those changes have delivered seven straight quarters of same-store sales and traffic growth for BJ's, as well as 3.1% total sales growth last year.

“It’s not like all ships are rising in casual dining,” said CEO Lyle Tick, “but I think those that are, are getting refocused on the things that matter.”

Applebee’s has been on a similar journey of late. A focus on menu innovation produced a pair of best-selling cheeseburgers, and it has also hit on a value proposition that works: Two meals for $25. And more recently, in a bid to improve service, the chain has asked managers to spend more time in the dining room interacting with customers.

“In this environment, I would argue, regardless of brand, [success] is about being a company that is focused on running good restaurants,” said John Peyton, CEO of Applebee’s parent Dine Brands, in an interview.

Value perception shift

Like much of the industry, casual-dining chains have also pushed out a wave of value meals and lower-priced items aimed at price-conscious consumers. Chili’s, Applebee’s, BJ’s, Red Robin and Outback Steakhouse all have their version of an Extra Value Meal. Even The Cheesecake Factory, strictly opposed to discounting, has added a selection of affordable “bites” that have proven popular.

All of the above has boosted casual dining’s value perception with consumers, an important factor at a time when many diners are looking to stretch their dollars as far as they can go.

“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 during an earnings call 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.”

That could be true: Top 500 quick-service sales rose 2.4% in 2025, slower than casual dining, and while fast casual grew by 6%, it was a notable deceleration from previous years, per Technomic data.

It’s another bit of evidence that casual dining is back, or at least on its way.

But again, the comeback has not been evenly distributed. For the second straight year, casual dining witnessed a crop of bankruptcies, most notably the 200-unit Hooters last March. On the Border, Bar Louie, Bravo/Brio, Bertucci’s, Pinstripes and Razzoo’s also restructured.

Most of them blamed some combination of lingering pandemic effects, inflation and slower consumer spending. Razzoo’s noted that it was losing customers to larger brands with more pricing power, like Chili’s and Applebee’s, underscoring the notion that consumers are being picky—and looking for value.

Also for the second straight year, Top 500 casual-dining chains closed more restaurants than they opened. Unit count was down by 0.3%, or about 45 units, to 16,269. It’s not necessarily the sign of a thriving segment. But it may not be the worst thing in the long run, Pawlak said.

“I still think our industry has too many seats chasing too few butts,” he said. “Population growth is basically flat, and we've overbuilt over a number of years. So I think there's still some room to take locations out.”

Overall, 2025 was not a bad year for casual dining. Some of the largest chains in the country had real success, and there are signs that it could be trickling down. Weaker locations are being weeded out, creating more opportunity for restaurants that remain. After a turbulent five years, the segment is finding its footing. And even better things could lie ahead.

“The bleeding has stopped,” Pawlak added. “Now, it's time to renourish and replenish that part of the industry, and I think the consumer's ready for it.”