US Steakhouse Chain Dethrones Olive Garden After Seven Years At The Top Of Casual Dining

Olive Garden has long reigned as the casual dining king in the United States—but that crown has now passed to a new contender. After seven years at the top, the pasta powerhouse has been overtaken by Texas Roadhouse, the budget-friendly steakhouse chain that's won over customers with hearty meals and down-to-earth prices.

The shift signals more than just changing palates. In the face of rising living costs, Americans appear to be voting with their wallets—favouring value and consistency over once-familiar favourites. And for Olive Garden, the signs of strain are starting to show.

Olive Garden's Revenue Falls Short Despite Expansion

Founded in Orlando, Florida, in 1982, Olive Garden has long been a go-to for family-friendly Italian-American dining. But according to Restaurant Business, the brand has slipped behind in revenue rankings. In 2024, it brought in £4.05 billion ($5.2 billion) in sales and added 15 new restaurants, approaching 1,000 locations across the country. Despite those figures, performance fell short of expectations.

The company had seen an 8.8% increase in sales in 2023 and anticipated a similar trajectory going into 2024. However, sales only rose by 0.8%, a disappointing figure attributed in large part to price hikes.

Price Increases Drive Customers Away

Last summer, Olive Garden's parent company Darden Restaurants announced a price increase of 2.5% to 3% across its dining brands, including LongHorn Steakhouse. As Fox Business reported, the company also stated it would not offer promotional discounts to offset the hike. This decision came during a time when inflation and economic uncertainty were already pushing customers to seek out more affordable dining options.

The result? A shift in consumer sentiment, with diners turning away from Olive Garden's higher prices in favour of chains offering better value for money.

Olive Garden's Attempted Comeback

Faced with slumping growth, Olive Garden backtracked on its no-promotions pledge. A few months after raising prices, it revived its iconic Never-Ending Pasta Bowl in a bold twelve-week-long promotion. The gamble paid off, leading to record-high refills and a 2% rise in profits during the three months ending 24 November.

The chain is also reintroducing popular menu items and has announced plans to launch an Uber-based delivery service for customers within eight miles of a location—moves aimed at restoring convenience and customer loyalty.

But while these efforts have made a modest impact, they may not be enough. As DailyMail noted, occasional promotions and revamped menus are no match for consistent affordability in an economy that's stretched consumers thin.

Texas Roadhouse's Rise to the Top

Texas Roadhouse, founded in Indiana in 1993, has now claimed the title of largest casual dining chain in the US by revenue. In 2024, the steakhouse generated £4.28 billion ($5.5 billion)—a 15% increase year-on-year—while expanding to more than 650 locations nationwide.

The secret to its success lies in its pricing. The chain has become known for offering a full meal—steak, potatoes, and vegetables—for between £15.57 and £19.46 ($20 to $25). As reported by the DailyMail, Texas Roadhouse has worked hard to keep prices low, earning it a loyal fanbase even as competitors raised theirs.

Its formula is simple: reliability, affordability, and portion size. These elements have propelled it past Olive Garden and into the top spot at a time when value is everything.

Changing Tastes or Economic Reality?

While some might interpret Texas Roadhouse's success as a shift in American food preferences—from Italian to steakhouse fare—the real story is economic. This is not about marinara versus barbecue; it's about price tags and public perception.

Texas Roadhouse's climb echoes other recent shifts, such as McDonald's overtaking Starbucks as the world's most valuable restaurant brand. As household budgets tighten, brands that prioritise their customers' wallets are rising to the top.

Who Else Made the Cut?

Other top performers in the US casual dining sector include Chili's, Applebee's, and Buffalo Wild Wings, each earning over £3 billion ($4 billion) in revenue. Chili's, in particular, saw a 31% surge in third-quarter orders, thanks to a revamped menu and smart social media strategy.

As tariffs and economic pressures loom, the dining landscape in America is being reshaped. In this environment, flashy menus and nostalgic promotions aren't enough. Diners want consistency, comfort, and above all—value. Whether other restaurant chains will follow Texas Roadhouse's lead or double down on high-margin strategies remains to be seen.

But one thing is clear: when times get tough, only the restaurants that truly serve their customers will survive.