Australian Mexican Fast Food Chain Guzman Y Gomez Exits US Market

Australian Mexican food chain Guzman Y Gomez (GYG) has left the United States market after it missed key sales and performance targets.

In a statement to the Australian Stock Exchange (ASX), the company said it had been consistent and transparent about the thresholds the business needed to prove the U.S. concept.

Despite the progress made by the team on brand and guest experience, the company said the financial performance of the U.S. business had “not been acceptable” and was “not meeting targeted hurdles.”

“I have always been confident in the differentiation of our food and guest experience, however this was not translating to an improvement in sales momentum. Having spent the last three months in the United States, I realised this was going to take significantly more time and capital than we had expected,” Co-CEO and founder Steven Marks said.

“In assessing the trajectory of the current network, the board and I have concluded that the business is unlikely to deliver the performance that would justify continued investment of shareholder capital.”

GYG Share Price Soars 15 Percent

Despite the exit announcement, GYG shares soared around 15 percent on May 21, trading at $20.83 (US$14.88) at the time of writing.

Aside from the news of the U.S. exit, the company also revealed it is expecting a huge growth in underlying profit in the 2026 financial year (FY).

GYG has updated its guidance to reveal an expected Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $85 million in the FY2026, up 29 percent from the previous year. EBITDA is a measure of the company’s underlying profit and financial performance.

The company entered the U.S. market in 2020 with its first restaurant in Chicago and grew the network to approximately eight restaurants by 2026. However, it faced intense competition from established players such as Chipotle and Taco Bell.

The board also made it clear that the decision does not undermine the global appeal of the GYG brand.

The company continues to see strong sales growth in Singapore and Japan, with GYG opening its 24th Singapore restaurant this week.

Australia the Main Focus

However, Australia remains the core focus as GYG is on track to open 32 new restaurants this financial year. The company debuted on the ASX in 2020.

Marks expressed confidence in the company’s long term future and ability to open 1,000 restaurants.

“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 percent,” he said.

“Concentrating our capital, focus and infrastructure behind this opportunity is the most effective way to compound shareholder value over the long-term.”

The U.S. exit is expected to result in a one-off non-cash and cash expense of between US$30 million and US$40 million in the 2026 financial year.

GYG’s withdrawal from the U.S. market comes after Collins Foods (ASX: CKF) announced plans to exit the Taco Bell brand in Australia in late March, transitioning 20 of its 27 restaurants to a new partnership with Restaurant Brands Australia Holdings and a Taco Bell-affiliated company.

The transition is expected to be completed between June and August 2026, with the remaining seven restaurants to be closed.