Papa Murphy’s has been a dominant force in the take-and-bake segment for years, but its footprint is no longer growing—quite the opposite, in fact.

Since early 2023, the chain, owned by MTY Food Group, has shuttered roughly 120 stores—not to mention dozens in 2022—a stark reversal for a brand that was once a fixture in suburban strip malls from coast to coast. The company seems to have a franchisee problem, as most of those closed stores have been franchised operations.

In a recent Q3 earnings call with investors, Eric Lefebvre, president and CEO of MTY, said the brand is righting the ship with the Papa Murphy’s closures. “As part of our ongoing efforts to strengthen the brand and position it for long-term success, we’ve made the difficult but strategic decisions, in partnership with our franchisees, to close a certain number of underperforming locations over the last year,” he said. “This allows us to focus our time, resources and support on markets and stores where we are seeing [the] strongest growth and guest engagement.”

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A recently opened location in Deer Park, Washington, is an example of the turnaround the company is shooting for. That store “currently generates sales of more than twice our brand’s average unit volume,” Lefebvre said. “We’re also making targeted investments in marketing,” including a collaboration with Mike’s Hot Honey.

Papa Murphy’s is also getting ready to relaunch its loyalty program, he noted. The update “transitions from a surprise-and-delight structure to a rewards-based system designed to both attract new guests and increase visit frequency among our loyal customers. Aggressive incentives will be offered to customers to generate interest around the relaunch….Other initiatives include menu optimization, SKU rationalization, and an entirely new lineup of exciting pizzas launching next year, all aimed at driving innovation, simplifying operations and enhancing the guest experience.”

On the plus side, along with an undisclosed number of closures, Papa Murphy’s opened 96 new stores in Q3. “The pipeline remains super strong for the next year or so, even the next 18 months,” Lefebvre said.

MTY Food Group, based in Canada, is something of a hospitality giant, with more than 90 brands in 40-plus countries. U.S. brands include Wetzel’s Pretzels, Famous Dave’s, Cold Stone Creamery, Champps, Blimpie and many others. For its quarterly reports, MTY doesn’t break down same-store comps for individual brands. But Lefebvre did say that Papa Murphy’s had seen a “system sales decline” in the third quarter of 2025.

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“For sure, it’s a very competitive space with pizza,” he told MTY’s investors. “You look at our competitors and…they all admitted to over-investing in marketing in the last few quarters, some of them $30 million, $40 million. That’s something we can’t afford to do. So we need to compete differently.

“What we’re seeing also at the moment is, we have some franchisees that are pulling out a little bit of their local marketing efforts,” he continued. “As you know, pizza is very marketing-driven. So as soon as you close the tap, you see the sales going down right away. And, unfortunately, some franchisees are just not putting their money into their business at the moment.”

Lefebvre said MTY is working to provide Papa Murphy’s franchisees with materials for new campaigns, hoping to motivate them to re-invest in marketing and get sales back where they need to be.

“Will there be more store closures in the future?” Lefebvre said. “Probably a few. But I think you’re not going to see closures of the magnitude we’ve seen in the last two years.”

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