Although pizza originated in Italy, America has arguably created its own pizza style, popularizing iconic regional styles like Chicago deep dish, New York thin crust, and Detroit square pan. Over time, pizza has become a staple food in the United States, and the largest pizza chains in the world are now primarily located in the United States.
The top domestic pizza chains by 2025 include Hunt Brothers Pizza, Domino’s Pizza (DPZ), Yum! Brands Pizza Hut (YUM), Papa Johns and Marco’s Pizza, according to ScrapeHero.
Papa John’s has been a major player in the industry for more than four decades, but even legacy brands are struggling amid growing competition. In the third quarter of 2025, comparable sales in North America fell 3% year-over-year, continuing its near-uninterrupted downward trend in the U.S. market.
That decline has led the company to make a major shift in its restaurant portfolio that could reshape its entire business in the coming years.
Papa Johns (PZZA) has sold 85 restaurants in Washington, D.C., and Baltimore, Maryland, to Pie Investments Management, led by Chris Patel, making the group one of the pizza chain’s largest franchisees in the United States.
With this acquisition, Pie Investments now operates more than 150 Papa Johns restaurants nationwide. The group plans to open 52 more stores in the Philadelphia market over the next five years, with a goal of reaching 250 stores by 2030.
The restaurants were previously owned by Colonel’s Limited, LLC, a joint venture between Papa Johns and Steeplechase Express, Inc. The group, led by the company’s oldest franchisee, now-retired William Freitas, opened the first Papa Johns restaurant in 1993 and became an early adopter of digital channels, helping the brand become one of the first major pizza chains to offer online ordering.
“Chris has built a leadership team with a passion for pizza, and his proven track record of acquiring restaurants and improving profitability is well known across the Papa John’s system,” Ravi Thanawala, Papa John’s chief financial officer and president of North America, said in a release.
This latest sale is part of a wider refranchising plan. During its fiscal 2025 third-quarter earnings call, Papa John’s said it plans to reduce the number of company-operated restaurants in North America to a mid-single-digit percentage of its nearly 6,000 restaurants worldwide.
Over the next two years, Papa John’s intends to accelerate its domestic refranchising efforts to drive profitable growth and expand into high-demand markets to improve the long-term economic model of its restaurants.
“We are responding to a challenging consumer and competitive environment and executing a strategy to ensure Papa John’s delivers sustainable profitable growth,” CEO Todd Penegor said on the earnings call. “While the full benefits will take some time, our transformation strategy is delivering positive results and we are taking far-reaching actions to accelerate the progress we are making.”
However, franchising also comes with risks.
“Labor experts say franchise chains have higher violation rates than company-operated chains because they invest less in maintaining their brand reputations,” The Washington Post’s Lauren Kaori Gurley and Emmanuel Martinez wrote. “They are also under pressure to keep labor costs low to cover high operating costs, especially franchise fees.”
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As of September 28, 2025, Papa John’s operated 5,994 restaurants in 51 countries and territories. Of its 3,517 North American units, 2,976 are franchised units.
Nonetheless, the company’s restructuring resulted in the closure of 28 franchise locations in North America during the same period.
“Growth in the pizza restaurant segment increasingly depends on how brands balance consistency with innovation,” said Restoworks. “It’s no longer enough to dominate by footprint or price; the winning operators are those that align their formats with local markets, experiment with flavors to suit emerging tastes and invest in technology.”
Last year, Papa John’s said it was taking “urgent” action to improve operations after several quarters of declining performance and highlighted five key elements to accelerate profitable growth.
“We are actively looking at the appropriate level of ownership in the company, what the role of refranchising is, and how to help spur further growth in our system as we expand our growth-minded franchisees and bring some new people into the system to ensure that we have some new growth-minded franchisees who want to be a part of Papa John’s journey going forward,” Penegor said on the company’s third-quarter 2024 earnings call.
Despite these efforts, Papa John’s stock has fallen more than 16.5% over the past year.
Meanwhile, there have been rumors since 2024 that Papa John’s could be acquired by private equity firms, including Apollo Global Management (according to Reuters ), TriArtisan Capital and Irth Capital Management. Although a formal agreement has not been reached, the sale would take the company private for the first time since 1993.
“Bearish analysts are concerned that ongoing takeover rumors have diverted attention away from core business fundamentals and performance metrics,” analysts at Simply Wall Street said. “Uncertainty over whether a formal acquisition will materialize and potential changes to deal terms could create share price volatility and downside risk.”
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This article was originally published by TheStreet on December 2, 2025, and first appeared in the Restaurant section. Click here to add TheStreet as your preferred source.