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42% of restaurants did not turn a profit last year, National Restaurant Association says

By John Wordock

With Americans watching their wallets, restaurants are feeling the pinch.

In its State of the Industry report for 2026, the main trade group for the nation’s restaurants and eateries is projecting sales will only grow moderately this year, rising 1.3%.

“It’s been a pretty challenging year for restaurants,” said Chad Moutray, chief economist for the National Restaurant Association. “We’ve seen costs rise pretty significantly for food, for labor costs, just a whole host of costs across the board.”

According to the report, 42% of restaurants surveyed nationwide said they were not profitable last year.

“Here in the D.C. area, obviously, we’ve had a lot of uncertainty with DOGE and government shutdowns and a lot of other kind of headwinds that have really hit the sector hard,” Moutray said.

Consumers are also thinking twice about eating out, as they face higher prices.

“At the same time, affordability is a big issue right now, and you have a situation where a lot of consumers are pushing back against price increases and really struggling to make ends meet,” Moutray said.

He said Americans are searching for comfort foods right now, like smashed burgers and protein.

“I think in times of uncertainty, people gravitate to soups and stews and burgers and meatloaf. I know I love those things,” Moutray said.

And with the popularity of weight loss drugs, he said Americans are seeking out healthier food options and cleaner recipes, and restaurants are learning to adapt.

“I think you are certainly seeing some restaurants that are leaning into protein, maybe leaning into smaller portion sizes, or appetizers and things along those lines,” Moutray said.

Massachusetts court hears arguments in lawsuit alleging Meta designed apps to be addictive to kids

By The Associated Press
BOSTON (AP) — Massachusetts' highest court heard oral arguments Friday in the state's lawsuit arguing that Meta designed features on Facebook and Instagram to make them addictive to young users. The lawsuit, filed in 2023 by Attorney General Andrea Campbell, alleges that Meta did this to make a profit and that its actions affected hundreds of thousands of teenagers in Massachusetts who use the social media platforms. “We are making claims based only on the tools that Meta has developed because its own research shows they encourage addiction to the platform in a variety of ways,” said State Solicitor David Kravitz, adding that the state's claim has nothing to do the company's algorithms or failure to moderate content. Meta said Friday that it strongly disagrees with the allegations and is “confident the evidence will show our longstanding commitment to supporting young people.” Its attorney, Mark Mosier, argued in court that the lawsuit “would impose liabilities for performing traditional publishing functions” and that its actions are protected by the First Amendment.
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