Dive Brief:
- Portillo’s laid off about 18% of its corporate headquarters’ active workforce, as well as a handful of field management roles, on July 31, the company said in a Wednesday earnings report.
- No restaurant-level employees were impacted, per the report.
- The action was meant to “align our team’s resources and decision-making more directly with priorities that matter most to our operators and guests,” Portillo’s CEO and President Brett Patterson said during an earnings call.
Dive Insight:
Portillo’s shifted its strategy last quarter following Patterson’s appointment, and is focusing on three strategic pillars: “operational excellence, integrated marketing and disciplined development.”
As part of that initiative, the company is targeting improvements to its foundation and operating discipline that support long-term profitable growth, Patterson said.
A simplification of its general and administrative structure will allow the company to have better focus, operate more nimbly and improve its restaurant-level support, he added.
"While never an easy decision, it is imperative that we examine areas of the business where we can operate more efficiently and ensure our resources and future investments are directed at the right priorities,” Patterson said in a statement. “These actions, along with other efficiencies, will support our long-term growth strategy."
The company also reviewed its supply chain and indirect spending categories to “capture meaningful efficiencies,” Patterson said. Additionally, it took a closer look at its development function from end-to-end to determine “where it can simplify processes, reduce costs and improve capital discipline.”
The chain has faced several quarters of same-store sales declines, reporting a 1.2% drop during the second quarter of 2026.
Portillo’s quickly expanded into Texas last year, but put the units too close together. This caused newly built restaurants to cannibalize each other’s sales, making it difficult for the restaurants to generate Portillo’s typically high unit volumes. The company has since pulled back on expansion in the Lone Star State, refocusing on slower, more profitable development.
For example, Portillo’s opened its first airport location in the Dallas-Forth Worth International Airport last month. Patterson said that the 3,100-square-foot location has a kitchen that is 25% smaller than a traditional Portillo’s restaurant and uses equipment enhancements designed to allow the company to work within smaller spaces — elements that could potentially be incorporated into new prototypes.
