The hits just keep on coming for casual dining in America. After Bravo Brio Restaurants, Bar Louie, and Hooters all sought bankruptcy protection in 2025, Texas chain Abuelo’s is now following suit. Based out of Lubbock, the Mexican eatery peaked with 40 locations but has since suffered a downturn that has taken a significant toll on its business.

As is the case with many businesses, the pandemic caused serious hardship. The company has cited several reasons for its filing, including increased food and labor costs. Last year the company saw sales fall by 15%, according to Restaurant Business. Problems date back as far as 2009 when expansion stopped, but several factors have come together to create the current challenges. Staffing challenges and changing preferences among diners were also brought up.

In the bankruptcy filing, Abuelo’s listed debts and liabilities between $10 million and $50 million, with parent company Food Concepts International also filing for protection. Because they are so closely tied together, the companies are looking to merge their bankruptcies in court.

Plano, Texas saw its Abuelo’s location close down in March after operating there since 1999. The location in Katy, Texas, which had been in business for seven years, shut down in January. In the fall of 2024, an Oklahoma City location also shut down. In various releases, the company made statements citing circumstances beyond their control as the reason for the closures.

Founded back in 1989, Abuelo’s serves many of the standard Mexican and Tex-Mex dishes you’d expect, from tacos and queso dip to fajitas and chimichangas. They also offer some more unique dishes, such as alambre and pork tenderloin abrigada. The company spread from Texas across nine states.

Abuelo’s aimed to create an authentic Mexican feel at each location with an open-air courtyard for dining and made-from-scratch dishes. This wasn’t just entrees, it even included the tortillas and sauces which were made in house. All of the recipes were said to come from Chef Luis E. Sanchez’s family recipes. The chain seemed like it was doing everything right and was consistently ranked by Consumer Reports as the best Mexican restaurant in America for years.

According to their website, Abuelo’s still has locations in seven states, but there are just 16 in total now, with more than half in Texas. For a company once on a promising trajectory and lauded for its approach to Mexican casual dining, the decline highlights the pitfalls and unpredictable nature of a quickly changing industry.