The doughnut chain beat revenue estimates and said its turnaround plan is improving margins, cash flow and balance-sheet health even as reported sales declined amid refranchising.
Krispy Kreme shares rose 2.3% in early trading Thursday after the doughnut chain sharply narrowed its fiscal second-quarter net loss and posted revenue above analyst estimates, adding to signs that its year-old turnaround is gaining traction. The company reported a GAAP net loss of $19.8 million, or $0.03 per share, compared with a loss of $435.3 million a year earlier, while revenue fell 12.8% to $331 million but topped the $320.72 million consensus estimate. The sales decline reflected refranchising and store closures tied to the company's asset-light strategy rather than a broad deterioration in underlying demand. Systemwide sales rose 1.1% in constant currency to $497.3 million and increased 2.6% excluding the ended McDonald's USA partnership. Adjusted EBITDA climbed more than 43% to $28.8 million, with consolidated adjusted EBITDA margin improving to 8.7% from 5.3% and U.S. segment margin expanding by 370 basis points. Krispy Kreme said cash flow also improved, helped by lower capital spending, outsourcing U.S. delivery logistics and continued refranchising, including the completion of its Japan transaction. The company maintained its guidance for systemwide sales growth of 2% to 4% and gave fiscal 2026 revenue guidance of $1.25 billion to $1.35 billion, below the $1.36 billion analyst consensus.