In a sign of the shifting landscape for casual dining, the iconic TGI Fridays filed for Chapter 11 bankruptcy protection on Saturday. The Dallas-based chain, once a staple of American dining out, is fighting to stay relevant and solvent in an era where customers increasingly prefer the convenience of delivery or the allure of upscale fast food.

In a statement addressing the filing, TGI Fridays Executive Chairman Rohit Manocha cited the chain’s capital structure and the economic impact of COVID-19 as primary causes for the financial turmoil. “The pandemic hit sit-down restaurants like ours hard, and our capital structure hasn’t allowed us the flexibility to rebound as quickly as we’d hoped,” he noted.

TGI Fridays isn’t alone in facing these pressures. As consumers’ dining preferences have evolved, casual dining chains have struggled to compete with the rise of fast-casual players like Chipotle and Shake Shack. Just this past September, Red Lobster similarly turned to bankruptcy court for a financial reorganization plan, underscoring the difficulties traditional sit-down establishments face in today’s economy.

Once a booming brand, TGI Fridays was at its peak in 2008, boasting 601 U.S. locations and a robust $2 billion in annual revenue. According to Technomic’s director of industry research, Kevin Schimpf, the chain’s U.S. sales were down 15% in 2023, hitting just $728 million. With only 163 locations left in the U.S.—down significantly from 269 last year—Fridays has been closing restaurants at a rapid pace. The chain shut down 36 locations in January alone and followed up with further closures in recent weeks.

Today, TGI Fridays operates a mere 39 of its U.S. restaurants directly. The rest, owned by independent franchisees, still carry the iconic red-and-white-striped branding across 41 countries under a separate entity, TGI Fridays Franchisor, which owns the intellectual property. This means that while U.S. corporate-owned stores are dwindling, the global presence of the brand remains strong, with 461 locations worldwide.

For many Americans, TGI Fridays represented the pinnacle of casual dining in the 1990s and early 2000s—a spot to gather with friends, enjoy a burger, and soak in the lively atmosphere. But as diners increasingly gravitate toward fast-casual alternatives and digital ordering, casual sit-down establishments like Fridays are forced to rethink their business models to survive. For brands like Fridays, remaining viable will likely mean adapting to modern dining habits while preserving the elements that once made them popular.

TGI Fridays has stated that the Chapter 11 filing is part of its strategy to secure “long-term viability,” but it’s clear that the company’s future will depend on making deep structural changes to reconnect with modern diners. The bankruptcy process, though difficult, could provide Fridays the opportunity to streamline its operations, reduce debt, and potentially bring new life to a brand that’s been serving Americans for nearly six decades.

As the reorganization progresses, TGI Fridays will have to confront some hard truths about the casual dining industry’s future. With consumers now prioritizing convenience and newer dining concepts, only time will tell if the iconic brand can reinvent itself to once again become a top choice for American diners. The coming months will be critical for the chain, as it seeks to write a new chapter in its storied history while honoring the legacy that made it a beloved part of American dining culture.