Guzman y Gomez abruptly closed all eight of its U.S. locations effective May 22, leaving former employees filing a class action lawsuit while the company’s Australian shares rose sharply on the withdrawal plan announced May 21.
For fans of burritos and fast-casual Mexican food, the surprise landed quickly: on May 21, Guzman y Gomez announced it would close all of its U.S. locations. By May 22, the restaurant doors were meant to stay shut.
The pullout has also hit people who weren’t ordering—employees who say they were left scrambling. Now, some former workers are taking the company to court, arguing they weren’t given the notice they believe federal and state law requires.
Guzman y Gomez, founded in Sydney in 2006, built its early pitch around bringing more authentic Mexican cuisine to Australia. Since then, it expanded across the Asia-Pacific region, including Singapore and Japan, and now has over 260 restaurants globally. Until recently, that global footprint included a U.S. presence.
On the company’s Australian website. the message for customers and staff was direct: “Effective from May 22nd. GYG USA restaurants will cease trading.” The U.S. website also carried the same sentiment. saying. “After six years of burritos and big dreams in Chicagoland. we’ve made the difficult decision to close our US restaurants. ” and thanking guests and the team for “building something special.”.
While the exact store list is no longer displayed on the company’s U.S. site, the Chicago Tribune reported that the first Guzman y Gomez location in the U.S. opened in Naperville, Illinois, in 2020, followed by seven more stores across Illinois—where all of the chain’s U.S. locations were based.
The eight U.S. locations that have closed are in:
Buffalo Grove, Illinois
Chicago, Illinois
Crystal Lake, Illinois
Deerfield, Illinois
Des Plaines, Illinois
Evanston, Illinois
Naperville, Illinois
Schaumburg, Illinois
The company’s website does not list those former locations anymore. The Chicago Tribune also reported that Guzman y Gomez had planned to open three more Illinois locations in 2026, but those plans have been abandoned following the exit from the U.S. market.
On the business side, the reason given for the abrupt shutdown was straightforward. During a call with investors on May 21, co-CEO Steven Marks said the company’s U.S. sales were not strong enough to justify staying open. The Chicago Tribune quoted him saying that Guzman y Gomez would be “ceasing to trade at our restaurants from today and proceeding with an orderly wind up of our operations in the U.S. ” adding that “Notwithstanding the progress made by the team. the financial performance of the U.S. has simply not been acceptable.”.
Marks also pointed to how operating conditions in the U.S. made brand-building harder, telling investors: “Starting with suburban drive-thrus has made it difficult to build brands in the U.S. Chicago has also been difficult.” He added, “What is important is that we make changes when we need to.”
The wider backdrop is familiar to anyone tracking global restaurant expansion: the U.S. market is crowded, and costs have risen even as consumer foot traffic has struggled. The challenge is sharper for international players in particular, competing against entrenched U.S. brands. Guzman y Gomez’s strategy landed in a country where Chipotle Mexican Grill already dominates, with more than 4,000 locations.
Back in Australia, the immediate financial reaction suggested investors were at least willing to accept the exit. Guzman y Gomez does not trade on U.S. markets, but it is publicly listed on the Australian Securities Exchange under the ticker GYG.AX. After the May 21 announcement of the U.S. withdrawal, its shares surged around 11%—a move that likely reflected approval of exiting a notoriously difficult market.
Yet the longer picture hasn’t been kind. Despite that jump, Guzman y Gomez shares have fallen more than 10% year to date, and over the past 12 months they are down more than 35%.
For employees, the disruption was not abstract. The Guardian reported that some U.S. workers were blindsided by the closures and have launched a class action lawsuit over the job losses.
The allegations claim employees were only informed about the shutdowns on May 21 via an internal company message board—hours after Marks spoke about the exit to analysts. The class action lawsuit alleges that federal and state laws required Guzman y Gomez to give 60 days’ notice before mass layoffs. something the plaintiffs say did not happen. The workers are seeking 60 days’ pay and benefits.
A spokesperson for Guzman y Gomez told the Guardian that the company is aware of the legal action and is “confident we have met all of our legal obligations to our US employees,” adding it was “not in a position to provide further comment on this matter.”
Taken together. the sequence is hard to miss: Guzman y Gomez told investors on May 21 it was moving forward with ending U.S. operations. told staff and customers that restaurants would cease trading effective May 22. and is now facing a lawsuit from employees who say they were not given time to prepare for what came next.
Guzman y Gomez Chipotle rival U.S. store closures class action lawsuit Steven Marks GYG.AX Australian Securities Exchange Illinois restaurants mass layoffs notice