Krispy Kreme, Inc.

What they do

Krispy Kreme sells fresh doughnuts through three channels: Hot Light Theater Shops and Fresh Shops, fresh delivery to grocery, convenience, QSR and drug stores, and digital ordering. Production runs through a Hub and Spoke model, with Doughnut Factories and Hot Light Theater Shops supplying smaller Fresh Shops and delivered-fresh doors. In the U.S. most points of access are Company-operated, while internationally both the Company and franchise partners operate locations.

Revenue drivers

• Fresh delivery doors — Doughnuts delivered from local Hubs to grocery, club, convenience, QSR and drug stores in branded cabinets; the Company added 448 U.S. fresh delivery doors in the first half of 2026, with U.S. average revenue per door per week up 33.2% to roughly $697.
• Hot Light Theater Shops and Fresh Shops — Consumer-facing shops where doughnuts are made and sold on premise; Hot Light Theater Shops average $2M-$5M in capital investment and Fresh Shops $0.1M-$1M.
• Digital — Pickup and delivery orders through Krispy Kreme's own platforms and third-party apps; described in the 10-K as the fastest-growing U.S. channel.
• International and franchise operations — Sales outside the U.S. come from Company-operated and franchise-operated points of access; the Company refranchised Japan and its western U.S. joint venture in March 2026 and signed new franchise markets including the Netherlands, Estonia and Mauritius.

Recent performance

Second quarter 2026 net revenue fell 12.8% to $331.0M, which the Company attributed to refranchising and the closure of underperforming doors in the third quarter of 2025. Systemwide sales rose 1.1% in constant currency, or 2.6% excluding the now-ended McDonald's USA partnership. GAAP net loss improved by $421.3M to $19.8M, and Adjusted EBITDA rose 43.2% to $28.8M, lifting Adjusted EBITDA margin to 8.7% from 5.3%. Global points of access fell 13.5% year over year to 15,665.

Strategy

The turnaround plan announced in August 2025 has four parts: refranchising international markets and the western U.S. joint venture, improving return on invested capital, expanding margins, and driving sustainable profitable growth. Refranchising of Japan and the western U.S. joint venture closed in March 2026, and U.S. logistics was outsourced in April 2026. Capital expenditures fell 70% in the first half of 2026 versus the prior-year period, and 59 shops opened year to date, nearly all franchised. Management is prioritizing U.S. fresh delivery growth over the ended McDonald's USA partnership.

Risks

• Food safety — Food-borne illness, tampering, contamination or cross-contamination could harm the brand and demand.
• Execution of the turnaround plan — The Company may fail to deliver refranchising, margin expansion and profitable growth as planned.
• Indebtedness and covenants — Krispy Kreme carries significant debt, with $794.2M of long-term debt and $21.8M of cash at June 28, 2026, and must meet credit facility covenants.
• Internal controls — The 10-K risk factors reference a previously identified material weakness, and ineffective remediation could impair timely and accurate financial reporting.

Outlook

Management said it maintains its previously issued 2026 financial guidance after the second quarter, citing confidence in achieving 2026 targets. CEO Josh Charlesworth pointed to leverage reduction, Adjusted EBITDA margin expansion and cash flow improvement as evidence the turnaround is working. The Company continues to pursue franchised international expansion, having signed the Netherlands, Estonia and Mauritius this year, and U.S. fresh delivery growth.