Red Lobster called its endless shrimp deal ‘irresistible.’ Then it lost $11M.

In hopes of attracting more customers during the summer and fall, Red Lobster in June made one of its most popular specialty dishes a mainstay on the menu: Ultimate Endless Shrimp.

In the past few months, the restaurant saw an uptick in customers, who could pay $20 to eat as many shrimp as they wanted. But the offer, which Red Lobster once called “irresistible,” might have been too popular for the restaurant’s own good.

Thai Union Group, a Thailand-based seafood supplier that owns a substantial stake in Red Lobster, said in a recent financial report that the restaurant suffered a roughly $11 million operating loss during its third quarter, as Restaurant Business first reported. Ludovic Regis Henri Garnier, Thai Union Group’s chief financial officer, said on a call with investors in November that the Ultimate Endless Shrimp deal contributed to the financial loss.

“The proportion of the people selecting this promotion was much higher compared to expectation,” Garnier said Nov. 7, according to a transcript of the call.

Red Lobster did not respond to a request for comment from The Washington Post on Thursday night.

Ultimate Endless Shrimp had been a special dish at Red Lobster for more than 18 years, usually appearing on the menu only on Mondays and for unique occasions. Red Lobster, which has more than 700 locations, made the shrimp a permanent menu item in late June.

Customers start by choosing two shrimp dishes, which are served with the chain’s signature cheddar biscuits, but can add additional shrimp dishes at no extra cost.

“Insider tip: avoid grabbing the extra biscuit to leave room for endless amounts of shrimp,” Red Lobster said in its June announcement.

More customers started dining at the restaurant than earlier in the year, but many ordered only the Ultimate Endless Shrimp, Thiraphong Chansiri, Thai Union Group’s chief executive, said on the call with investors. The deal was so popular that some people on social media competed to eat the most shrimp in one sitting or found strategies to consume as many as shrimp as possible.

Red Lobster’s third fiscal quarter ran between July and the end of September.

“Bottom line, in terms of financial performance, it did not deliver what we were expecting,” Garnier said on the call.

Garnier said that Red Lobster has recently increased the price for Ultimate Endless Shrimp to $25 — a change that has improved the restaurant’s operating costs.

Still, Red Lobster is expected to lose nearly $20 million this year, according to Thai Union Group’s recent financial report.

This isn’t the first time Red Lobster has suffered financially from an “endless” dish promotion. In 2003, the restaurant lost millions of dollars after underestimating how many crabs people typically eat in one sitting.

Other restaurants have faced financial issues from similar promotions, including Olive Garden, which didn’t offer its never-ending pasta promotion in 2020 and 2021. Applebee’s failed to meet financial expectations in 2004 after serving all-you-can-eat riblets.

Despite Red Lobster’s recent financial losses, the restaurant isn’t planning to abandon its promotion of unlimited shrimp, one of its signature dishes.

“We want to keep it in the menu,” Garnier said. “But of course, we need to be much more careful regarding what is the entry point and what is the price point we are offering for this promotion.”

Jaclyn Peiser contributed to this report.

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