Red Lobster Ditches Popular Deal, Big Change But There’s A Catch

Iconic seafood chain Red Lobster has hit a financial snag due to a popular all-you-can-eat shrimp deal that became a permanent fixture on its menu. The Ultimate Endless Shrimp offering, which was initially introduced in June, has caused the company to suffer millions in losses.

Details of the financial decline were revealed in third and fourth quarter earnings reports from 2023. Red Lobster’s losses have been attributed to an $11 million operating loss in the third quarter and a $12.5 million loss in the fourth quarter, both of which were directly linked to the bottomless shrimp deal.

The deal, which initially cost $20, allowed customers to consume as many shrimp as they wanted. However, after seeing an increase in profits, Red Lobster slowly raised the price to $23 and $25, but this did not prevent the financial decline.

The shrimp deal proved to be too popular, with customers taking full advantage of the unlimited offering. The company’s fourth quarter report noted that it had to adjust its costs to accommodate the high demand for shrimp, resulting in the losses.

Thai Union Group, a minority investor in Red Lobster, has also announced its exit from the company citing the bottomless shrimp deal as a factor. The company initially reported losses of $19 million in 2023, but recently updated this total to $22 million.

On an earnings call, Thai Union Group CFO Ludovic Garnier explained that the goal of the cheap shrimp deal was to attract more customers, but it did not work as expected. He also added that the company is in the process of selling its shares in Red Lobster but wasn’t hopeful about what they would get in return.

Thai Union Group’s CEO, Thiraphong Chansiri, expressed his disappointment with the shrimp deal and revealed that he would be avoiding lobster from now on. Despite this setback, Red Lobster is moving forward with its annual Lobsterfest celebration, which features an all-you-can-eat experience. However, this time, it’s with lobster instead of shrimp.

The company has announced the Endless Lobster Experience, where 150 lucky fans will have the opportunity to indulge in a two-hour-long feast with all the lobster they can eat. While the food is complimentary, customers will still have to pay for drinks, tax, and gratuity.

Red Lobster fans who are unable to secure a spot in the Endless Lobster Experience need not fret, as the Lobsterfest menu features at least 10 limited-edition dishes to choose from, including the Lobster Lover’s Duo and Crispy Lobster & Shrimp Stack. The company has also introduced five new dishes for this year’s celebration.

Fans should keep a close eye on Red Lobster’s social media accounts for more information and instructions. The company’s history of multiple CEOs over the years has not made things easy for them either. But despite these challenges, Red Lobster continues to stand as a popular seafood destination, and customers can look forward to indulging in their favorite dishes at Lobsterfest.

The U.S. Sun