TLDR
- DNUT shares soared 17.1% in premarket after delivering Q4 adjusted EPS of $0.09, crushing the $0.03 analyst forecast by $0.06
- Q4 sales totaled $392.4 million, modestly topping the Street’s $389.47 million projection
- Adjusted EBITDA surged 21% to reach $55.6 million, while margin improved by 280 basis points to 14.2%
- Store optimization continues as Global Points of Access declined 13.5% to 15,194 locations
- 2026 outlook calls for systemwide sales expansion of 2–4% along with anticipated positive free cash flow
Krispy Kreme (DNUT) rocketed 17.1% higher during Thursday’s premarket session following the release of fourth quarter financial results that substantially exceeded analyst forecasts across key metrics.
The donut retailer delivered adjusted earnings per share of $0.09 for the quarter, significantly outperforming the Wall Street consensus of $0.03. Sales reached $392.4 million, narrowly surpassing analyst projections of $389.47 million.
Investors responded enthusiastically to the strong performance.
Quarterly net revenue declined 2.9% compared to the year-ago period’s $404 million. This decrease was strategic rather than problematic — the company has deliberately shuttered underperforming stores as it executes a comprehensive turnaround strategy.
The company’s Global Points of Access contracted 13.5% to 15,194, representing a reduction of 2,363 locations versus the previous year. While substantial, this pullback reflects management’s focus on quality over quantity.
The strategy appears effective. Adjusted EBITDA jumped 21% year-over-year to $55.6 million, while the adjusted EBITDA margin expanded by a robust 280 basis points to 14.2%.
Profitability Metrics Show Significant Progress
The margin enhancement resulted from multiple factors: productivity improvements, selling, general and administrative expense reductions, elimination of costs associated with the terminated McDonald’s USA collaboration, and $4.8 million from business interruption insurance related to a 2024 cybersecurity event.
Within the domestic segment, average weekly revenue per location increased 4.5% year-over-year to $660, benefiting from the closure of lower-performing sites. U.S. Adjusted EBITDA improved by $9.2 million to reach $32.8 million.
The reported GAAP results present a more challenging narrative. The company recorded a net loss of $29.1 million, or $0.17 per diluted share, versus a net loss of $22.2 million, or $0.13 per share, during the comparable 2024 quarter.
For fiscal 2025, DNUT generated net revenue of $1.52 billion, representing an 8.6% decrease from $1.67 billion. The full-year GAAP net loss totaled $523.8 million, contrasting with net income of $3.8 million during 2024. The substantial loss stemmed partially from divesting a controlling interest in Insomnia Cookies and ending the McDonald’s partnership.
Full-year adjusted EBITDA decreased 27.5% to $140.3 million.
Forward Guidance Points to Continued Recovery
For 2026, Krispy Kreme projects systemwide sales growth between 2% and 4% in constant currency terms from the 2025 baseline of $1.96 billion.
Management plans to launch at least 100 new locations worldwide while targeting capital expenditures in the $50 million to $60 million range. The company anticipates generating positive free cash flow and maintaining a net leverage ratio at or beneath 5.5x.
DNUT revealed a refranchising transaction involving its Japan business unit, anticipated to complete during Q1 2026 with approximately $65 million in cash proceeds. Management also intends to restructure its Western U.S. joint venture arrangement with WKS Restaurant Group.
Digital sales as a proportion of retail revenue climbed to 18.2% in 2025 from 14.4% during 2024 — representing a 380 basis point improvement.
CEO Josh Charlesworth emphasized the company’s commitment to “profitable U.S. expansion and capital-light international franchise growth” as central pillars of its recovery strategy.
The Japan refranchising transaction is projected to finalize in the opening quarter of 2026.
