TL;DR
Guzman y Gomez, a fast-casual Mexican chain from Australia, has closed all its U.S. restaurants after six years in operation. The move marks a retreat from the American market despite previous expansion ambitions. Industry pressures such as higher food costs and declining traffic contributed to the closure.
Guzman y Gomez, an Australian-born Mexican fast-casual chain, has closed all of its U.S. restaurants, effective immediately, after six years of operation in Chicago. The company cited business challenges and a reassessment of its U.S. strategy as reasons for the closure, marking a significant retreat from its previously ambitious expansion plans in the American market.
The chain’s U.S. website and social media accounts announced the closure on Friday, with a message thanking customers and employees in Chicagoland. All eight U.S. locations are now permanently closed, with the company expressing gratitude for customer support over the years.
Founded in Australia by New Yorkers Steven Marks and Robert Hazan, Guzman y Gomez entered the U.S. market in 2020 with plans to rapidly expand across the country. The company had projected opening hundreds, if not thousands, of locations but has now exited entirely, citing sales difficulties and the need for substantial additional investment.
In a statement on the Australian Securities Exchange, Marks acknowledged that despite confidence in the brand’s differentiation, sales momentum in the U.S. was insufficient to justify further investment. The company’s stock surged briefly following the announcement, reflecting investor relief at the retreat from an unprofitable market.
Why It Matters
The closure is significant because Guzman y Gomez was viewed as a potential challenger to Chipotle in the U.S., with a focus on cleaner ingredients and fast-casual dining. Its exit leaves Chipotle with fewer direct competitors in the Mexican fast-casual segment and highlights the ongoing difficulties faced by smaller chains amid rising food costs, inflation, and declining consumer traffic.
This move underscores broader industry challenges, as many restaurant chains struggle with higher operational costs and cautious consumer spending. The exit also signals the difficulty foreign brands face when attempting to scale rapidly in the competitive U.S. fast-food market.
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Background
Guzman y Gomez, founded in Australia, expanded into the U.S. in 2020 with high hopes for rapid growth. The company’s ambitions were to establish a large footprint, particularly in the Chicago area, which it chose as its entry point. However, recent industry data shows that restaurant traffic and consumer spending on eating out have declined, partly due to inflation and higher food prices.
In January 2026, food-away-from-home prices increased by nearly 40% since 2019, putting pressure on casual dining chains. Guzman y Gomez’s decision to exit follows similar struggles among other restaurant brands facing economic headwinds, as well as internal assessments indicating limited prospects for success in the U.S. market.
“Having spent the last three months in the US, I realized this was going to take significantly more time and capital than we had expected.”
— Steven Marks, Guzman y Gomez founder
“We have a long runway ahead of us in Australia as we progress towards our long-term target of 1,000 restaurants and segment underlying EBITDA as a percentage of network sales of 10%.”
— Australian Securities Exchange announcement
“The U.S. business had very low prospects of being successful, and the losses of the business were weighing down the earnings of the group so the sooner exit than anticipated is positive.”
— FMR Fast Food CEO (via Reuters)
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What Remains Unclear
It is not yet clear whether Guzman y Gomez plans to re-enter the U.S. market in the future or if this closure is permanent. Details about the financial losses incurred or specific internal assessments remain undisclosed. The impact on employees and local suppliers in Chicago is also still developing.
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What’s Next
The company will focus on consolidating its presence in Australia, Japan, and Singapore, where it remains active. Future announcements may include new markets or strategies for growth outside the U.S., but no specific plans have been disclosed yet.
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Key Questions
Why did Guzman y Gomez close its U.S. locations?
The company cited insufficient sales momentum, high operational costs, and the need for significant additional investment as reasons for the closure, according to its CEO and public statements.
Will Guzman y Gomez reopen in the U.S.?
There are no current plans to reopen or re-enter the U.S. market. The company is now focusing on its existing markets in Australia, Japan, and Singapore.
How many U.S. locations did Guzman y Gomez operate?
The chain operated eight locations in the Chicago area before closing all of them in May 2026.
What does this mean for competitors like Chipotle?
The exit reduces competition in the fast-casual Mexican segment, potentially benefiting Chipotle, which has about 4,000 restaurants nationwide.
Source: Google Trends
