The Reason We Lost So Many Dairy Queen Locations In 2025
In early 2025, it seemed like Dairy Queen was becoming a thing of the past for many Texans after more than three dozen locations melted away like ice cream. All of those fast food restaurant closures involved the franchisee Project Lonestar, which is in a legal battle with the American Dairy Queen Corporation (ADQC). According to court filings, as part of a previous arrangement, the franchisee needed to remodel its locations or close them. In 2024, ADQC reached out in an attempt to enforce updates, as well as collect overdue royalties. However, it seems Project Lonestar decided against remodeling. Court documents state that the franchisee was given an opportunity to make back payments and secure a buyer for its stores within 30 days in October 2024.
It later came to light that Project Lonestar allegedly found a buyer and had caught up on its royalties. But it was unable to work with American Dairy Queen Corporation to make the deal happen. Project Lonestar claimed the sale fell through after ADQC imposed even more financial obligations as a condition of transferring ownership. Initially, 25 Dairy Queen franchise locations closed in February 2025. However, the problems didn't end there. Project Lonestar said the parent company cut off its remaining stores from receiving supplies, making operations as usual impossible. A total of 12 more locations would close by the end of March.
In February 2025, Project Lonestar sued the ice cream company. The franchisee reportedly accused ADQC of causing $4 million in damages. However, at the time of the filing, it only sought $1 million.
What became of the Dairy Queens in Texas?
The Texas towns that lost locations in 2025 were primarily in southern and eastern parts of the state. Among them was the Sour Lake Dairy Queen, which had been in business for over 50 years. Still, Texas has more DQ locations than anywhere else in the country. There are approximately 560 stores open and ready to turn your Blizzard upside down in the Lone Star State.
Today, you can find a few closed Dairy Queens listed for sale online. The full contents of about two dozen restaurants were auctioned off in February 2025. A location in North Richland Hills, Texas, had the highest bid, at $27,000, while offers for some spots were as low as $5,600. However, the fallout wasn't merely financial. Small-town fans of Dairy Queen ice cream, along with those who were employed at these franchise spots, have struggled with the closures at a heart and home level. A Facebook post from a 31-year employee of DQ hit especially hard. The person asked for prayers for the "crew and their families" and gave thanks to the locals who supported the restaurant over the years.