Form type: 10-Q
Period end: 2026-06-28
| Three Months Ended June 28, 2026 | Three Months Ended June 29, 2025 | Six Months Ended June 28, 2026 | Six Months Ended June 29, 2025 | |
|---|---|---|---|---|
| Revenue | 330,995,000 | 379,767,000 | ||
| Total Revenue | ||||
| Total COGS | ||||
| Gross Profit | ||||
| Income tax expense (benefit) | -4,259,000 | -20,453,000 | ||
| Net income attributable to noncontrolling interests | 480,000 | -5,858,000 | ||
| Other income statement items (derived) | 258,223,000 | 737,703,000 | ||
| Other nonoperating income (expense), net | -261,000 | -1,177,000 | ||
| Production and distribution costs | 86,037,000 | 92,627,000 | ||
| Selling and marketing | 11,086,000 | 12,185,000 | ||
| Total Expenses | ||||
| Net Income | - | - | - | - |
| Net income (loss) available to common stockholders | - | - | ||
| Basic earnings per share | - | - |
| June 28, 2026 | December 28, 2025 | |
|---|---|---|
| Assets | ||
| Accounts receivable | 77,411,000 | 61,611,000 |
| Assets held for sale | 2,273,000 | 13,294,000 |
| Cash and cash equivalents | 21,825,000 | 42,390,000 |
| Deferred costs | 1,024,000 | 0 |
| Goodwill and intangibles | 1,397,470,000 | 1,510,013,000 |
| Inventory | 28,666,000 | 26,877,000 |
| Operating lease right-of-use assets | 350,029,000 | 395,523,000 |
| Other assets (derived) | 35,084,000 | 49,323,000 |
| Other noncurrent assets | 52,806,000 | 13,565,000 |
| Prepaid expenses and other current assets | 20,766,000 | 18,927,000 |
| Property, plant and equipment | 375,652,000 | 460,935,000 |
| Restricted cash and equivalents | 317,000 | 501,000 |
| Total Assets | ||
| Liabilities | ||
| Accounts payable | 148,502,000 | 134,384,000 |
| Accrued liabilities | 91,634,000 | 99,805,000 |
| Debt, current | 0 | 65,977,000 |
| Debt, including current maturities | 9,369,000 | 833,958,000 |
| Deferred revenue | 14,780,000 | 16,668,000 |
| Deferred revenue, noncurrent | 9,837,000 | 9,780,000 |
| Deferred tax liabilities | 93,802,000 | 96,236,000 |
| Finance lease liabilities, current | 16,286,000 | 21,614,000 |
| Finance lease liabilities, noncurrent | 45,381,000 | 56,280,000 |
| Liabilities held for sale | 0 | 13,535,000 |
| Long-term debt | 794,214,000 | 0 |
| Operating lease liabilities, current | 46,951,000 | 51,213,000 |
| Operating lease liabilities, noncurrent | 351,011,000 | 395,895,000 |
| Other liabilities (derived) | 121,777,000 | 120,653,000 |
| Total Liabilities | ||
| Temporary equity | ||
| Redeemable noncontrolling interests | 0 | 24,181,000 |
| Total temporary equity | ||
| Equity | ||
| Stockholders equity | 618,055,000 | 650,123,000 |
| Total stockholders equity attributable to parent | ||
| Noncontrolling interests | 1,724,000 | 2,657,000 |
| Total Equity | ||
| Six Months Ended June 28, 2026 | Six Months Ended June 29, 2025 | |
|---|---|---|
| Operating activities | ||
| Net income | -43,095,000 | -468,544,000 |
| Depreciation and amortization | 59,123,000 | 69,683,000 |
| Stock-based compensation | 7,926,000 | 7,237,000 |
| Changes in operating assets and liabilities, net | -13,993,000 | 338,247,000 |
| Net cash from operating activities | - | |
| Investing activities | ||
| Investing activities, net | 67,989,000 | 30,937,000 |
| Net cash from investing activities | ||
| Financing activities | ||
| Financing activities, net | -98,902,000 | 16,248,000 |
| Net cash from financing activities | - | |
| Effect of exchange rate changes on cash | - | |
| Net change in cash | - | - |
| Cash at beginning of period | 29,315,000 | |
| Cash at end of period | 21,823,000 | |
| Six Months Ended June 28, 2026 | Six Months Ended June 29, 2025 | |
|---|---|---|
| Balance at beginning of period | 652,780,000 | 1,137,135,000 |
| Net income | -43,095,000 | -468,544,000 |
| Other equity movements | 10,094,000 | 49,598,000 |
| Balance at end of period | 619,779,000 | 718,189,000 |
Krispy Kreme, Inc. is a public reporting company classified under Retail-Food Stores, and the accompanying unaudited condensed financial statements have been prepared from the Company's books and records as of and for the period ended June 28, 2026. In the opinion of management, the interim statements include all adjustments necessary for a fair presentation of the results for the periods presented, and the results of operations for the interim period are not necessarily indicative of the results to be expected for the full fiscal year. Management evaluated disclosure controls and procedures as of the end of the period and concluded they were effective at the reasonable assurance level, and no changes materially affected internal control over financial reporting during the quarter. The Company is involved in legal proceedings arising in the ordinary course of business from time to time, and management does not currently believe any pending matter is material to the financial statements.
Revenue for the period was $330,995,000, a decrease of 12.8% from $379,767,000 in the prior period. Production and distribution costs were $86,037,000, down 7.1% from $92,627,000, and selling and marketing expenses were $11,086,000, down 9.0% from $12,185,000. The Company recognized an income tax benefit of $4,259,000 for the period, compared with a benefit of $20,453,000 in the prior period. The Company reported a net loss of $20,311,000 for the period. Deferred revenue was $14,780,000 in current balances, a decrease of 6.3%, and $9,837,000 in noncurrent balances, an increase of 5.9% from the prior period. Basic earnings per share for the period was $(0.12), computed using weighted-average basic shares outstanding of 172,578,000.
As of the end of the current period, the Company reported long-term debt of $794,214,000, compared to no long-term debt in the prior period, while current debt declined to $0 from $67,603,000, a decrease of 100.0%. Debt, including current maturities, decreased to $9,369,000 from $795,073,000. In addition, the Company carried finance lease liabilities of $16,286,000 current and $45,381,000 noncurrent, and operating lease liabilities of $46,951,000 current and $351,011,000 noncurrent, as of the current period. Operating lease right-of-use assets were $350,029,000, a decrease of 16.4% from $418,602,000 in the prior period. Total debt was $1,743,544,000 as of the end of the period. The Company's business is subject to risks relating to its significant indebtedness and its ability to meet the financial and other covenants under its credit facilities.
Stockholders' equity was $618,055,000 as of the end of the period, a decrease of 10.9% from $693,591,000 in the prior period. Noncontrolling interests were $1,724,000, down 93.0% from $24,598,000, and net income attributable to noncontrolling interests was $480,000 for the period, compared with a loss attributable to noncontrolling interests of $5,858,000 in the prior period. Total equity, including noncontrolling interests, was $619,779,000 as of the end of the period. [COMPLETE: description of changes in common shares outstanding, dividends, and equity award activity during the period, if any]
| Current | Prior | |
|---|---|---|
| Debt, current | 0 | 65,977,000 |
| Debt, including current maturities | 9,369,000 | 833,958,000 |
| Finance lease liabilities, current | 16,286,000 | 21,614,000 |
| Finance lease liabilities, noncurrent | 45,381,000 | 56,280,000 |
| Long-term debt | 794,214,000 | 0 |
| Operating lease liabilities, current | 46,951,000 | 51,213,000 |
| Operating lease liabilities, noncurrent | 351,011,000 | 395,895,000 |
| Total debt | 1,263,212,000 | 1,424,937,000 |
| Current | Prior | |
|---|---|---|
| Property, plant and equipment | 375,652,000 | 460,935,000 |
| Total property and equipment | 375,652,000 | 460,935,000 |
| Current | Prior | |
|---|---|---|
| Stockholders equity | 618,055,000 | 650,123,000 |
| Total stockholders' equity | 618,055,000 | 650,123,000 |
The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes included elsewhere in this quarterly report. Krispy Kreme, Inc. is a public reporting company classified under Retail-Food Stores. The Company's comprehensive turnaround plan, announced in August 2025, is designed to deleverage the balance sheet and deliver sustainable, profitable growth. In the first two quarters of fiscal 2026, we restructured our consolidated subsidiary in the western U.S., W.K.S. Krispy Kreme, to a minority ownership interest and completed the sale of our operations in Japan. We continue to evaluate additional refranchising opportunities and remain focused on identifying the right partners both in international markets and the U.S. to maximize value and position the Company for long-term growth. The plan also targets improving return on invested capital by reducing capital intensity through the use of existing assets and a focus on franchise development.
Revenue for the period ended June 28, 2026 was $331.0 million, a decrease of 12.8% from $379.8 million in the comparable prior-year period, driven primarily by the restructuring of W.K.S. Krispy Kreme to a minority ownership interest and the completed sale of our operations in Japan. Production and distribution costs decreased 7.1% to $86.0 million from $92.6 million, and selling and marketing expense decreased 9.0% to $11.1 million from $12.2 million, reflecting lower volumes following the refranchising activity. Other income statement items decreased 65.0% to $258.2 million from $737.7 million in the prior-year period. We recognized an income tax benefit of $4.3 million in the current period, compared to a benefit of $20.5 million in the prior-year period. Net income attributable to noncontrolling interests was $0.5 million in the current period, compared to a net loss attributable to noncontrolling interests of $5.9 million in the prior-year period. For the period, we reported a net loss of $20.3 million, or $(0.12) per basic share based on weighted-average basic shares outstanding of 172,578,000.
Cash and cash equivalents were $21.8 million as of June 28, 2026, an increase of 2.6% from $21.3 million in the prior period, and restricted cash and equivalents were $0.3 million compared to $0.6 million in the prior period. Consistent with our deleveraging objectives, current debt was reduced to zero from $67.6 million, and debt including current maturities declined 98.8% to $9.4 million from $795.1 million, while long-term debt of $794.2 million was outstanding at period end. Finance lease liabilities declined, with current finance lease liabilities down 21.5% to $16.3 million and noncurrent finance lease liabilities down 38.4% to $45.4 million, and noncurrent operating lease liabilities decreased 16.3% to $351.0 million. Accounts payable increased 52.4% to $148.5 million, accrued liabilities decreased 17.3% to $91.6 million, and stockholders' equity was $618.1 million compared to $693.6 million in the prior period. Our primary market risk exposure is interest rate risk on cash, cash equivalents, and short-term investments, and we do not have material foreign currency or commodity price exposure. Management believes that our existing cash and cash equivalents, together with cash generated from operations and available financing arrangements, will be sufficient to meet our working capital, capital expenditure, and debt service requirements for at least the next twelve months.
Our primary market risk exposure is interest rate risk on our cash, cash equivalents, and short-term investments. Changes in prevailing interest rates affect the amount of interest income we earn on these balances, and a decline in market interest rates would reduce our future interest income. As of the end of the period, we held cash and cash equivalents of $21.8 million, compared with $21.3 million at the prior period end, as well as restricted cash and equivalents of $0.3 million. [COMPLETE: quantified interest rate sensitivity analysis, such as the estimated impact of a hypothetical change in interest rates on interest income].
We are also subject to interest rate risk in connection with our outstanding indebtedness to the extent that borrowings bear interest at variable rates. As of the end of the period, we had long-term debt of $794.2 million and no current debt outstanding, compared with current debt of $67.6 million at the prior period end, and debt including current maturities of $9.4 million, compared with $795.1 million at the prior period end. In addition, we had finance lease liabilities of $16.3 million classified as current and $45.4 million classified as noncurrent, along with current operating lease liabilities of $47.0 million and noncurrent operating lease liabilities of $351.0 million. [COMPLETE: description of the fixed- and variable-rate composition of outstanding borrowings, applicable reference rates, and the estimated effect of a hypothetical change in interest rates on interest expense].
We do not have material foreign currency or commodity price exposure. Accordingly, we do not believe that reasonably possible near-term changes in foreign currency exchange rates or commodity prices would have a material effect on our financial position, results of operations, or cash flows. We will continue to monitor our market risk profile, which remains concentrated in interest rate risk on our cash, cash equivalents, and short-term investments rather than foreign currency or commodity price risk.
Management of Krispy Kreme, Inc., with the participation of the company's [COMPLETE: certifying officers, e.g., Chief Executive Officer and Chief Financial Officer], carried out an evaluation of the effectiveness of the design and operation of the company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of June 28, 2026, the end of the period covered by this Quarterly Report on Form 10-Q. Disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to management, including the certifying officers, to allow timely decisions regarding required disclosure. Based on that evaluation, management concluded that the company's disclosure controls and procedures were effective at the reasonable assurance level as of the end of the period.
In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. There were no changes in the company's internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting.
The foregoing conclusions and related language are subject to review and adoption by management prior to filing.
Krispy Kreme, Inc. is involved in legal proceedings arising in the ordinary course of business from time to time. These matters may include claims and disputes incidental to the conduct of our operations, and the outcome of any such proceedings is inherently uncertain.
Management does not currently believe that any pending matter is material to the financial statements. We will continue to monitor developments in these matters and will make any additional disclosures required in future periods.
Our business faces numerous risks and uncertainties that could materially and adversely affect our business, financial condition, results of operations, and cash flows. These include, among others, disruptions to our and our franchisees' supply chain, including the loss of or failure to perform by single-source or limited suppliers, vendors, distributors, or manufacturers; our significant indebtedness and our ability to meet the financial and other covenants under our credit facilities; changes in the cost of raw materials and fuel or other commodities, including due to import and export requirements (including tariffs), inflation, fluctuations in foreign exchange rates, or heightened geopolitical tensions (including the recent Iran conflict); our ability to recruit and retain key personnel; failure to develop or maintain effective internal control over financial reporting or disclosure controls and procedures; adverse regulatory actions or publicity concerning food or occupational safety, food quality, health, and other issues or regulatory investigations, enforcement actions, or material litigation; and other risks and uncertainties described under the heading "Risk Factors" and elsewhere in our Annual Report on Form 10-K, filed by us with the SEC and in other filings we make from time to time with the SEC.
Our indebtedness and related obligations remain a significant risk to our financial condition. As of the end of the current period, we reported long-term debt of $794,214,000, compared to no long-term debt in the prior period, while current debt declined to $0 from $67,603,000, a decrease of 100.0%. In addition, we carried finance lease liabilities of $16,286,000 current and $45,381,000 noncurrent, and operating lease liabilities of $46,951,000 current and $351,011,000 noncurrent, as of the current period. Our exposure to interest rate risk also arises in connection with these borrowings, and changes in prevailing rates or in our ability to comply with covenants under our credit facilities could adversely affect our liquidity and results of operations. As of June 28, 2026, we held cash and cash equivalents of $21,825,000, an increase of 2.6% from $21,264,000 in the prior period, along with restricted cash and equivalents of $317,000. Based on current cash and cash equivalents, the actions taken under the turnaround plan to deleverage the balance sheet, and anticipated cash flows from operations, management believes our resources are sufficient to fund our operations and meet our obligations for at least the next twelve months; however, there can be no assurance that these expectations will be realized.
Our recent operating results underscore the risks to our business. For the period ended June 28, 2026, we generated revenue of $330,995,000 and incurred a net loss of $20,311,000, and revenue declined 12.8% from $379,767,000 in the prior period. If these trends continue or worsen, our financial condition and results of operations could be further adversely affected. We are also involved in legal proceedings arising in the ordinary course of business from time to time, and although management does not currently believe any pending matter is material to the financial statements, adverse outcomes in litigation or regulatory matters could result in losses that exceed our expectations. Investors should carefully consider the foregoing risks together with the other information contained in this report and in our other filings with the SEC.
The following disclosure is provided pursuant to Item 408(a) of Regulation S-K regarding Rule 10b5-1 trading arrangements of the directors and officers of Krispy Kreme, Inc. for the quarterly period ended June 28, 2026. [COMPLETE: Rule 10b5-1 trading arrangement adoptions and terminations from the D&O questionnaires]