Krispy Kreme shares are 40% off their price a year ago / Photo: krispykreme.com
Shares of doughnut maker Krispy Kreme surged 27.8% after the company released its fourth-quarter and full-year financial results. The company said it expects further deleveraging and progress in executing its turnaround plan following the end of its partnership with McDonald’s.
Details
Krispy Kreme shares rose 27.76% on Thursday to close at $3.82 apiece.
The company reported that its net leverage ratio declined to 6.7 in the fourth quarter of 2025 from about 7.3 a quarter earlier. Krispy Kreme expects to further strengthen its balance sheet, projecting a net leverage ratio of 5.5 or lower in 2026 amid positive cash flow.
At the same time, Krispy Kreme did not provide guidance on profitability, as the company continues to restructure its business and transfer certain operations to franchisees, CEO Josh Charlesworth said in an interview with Bloomberg.
Other earnings highlights
Adjusted earnings before interest, taxes, depreciation, and amortization for the fourth quarter rose 21% year over year to $55.6 million, driven by cost savings, the elimination of McDonald’s-related expenses, and insurance proceeds related to a 2024 cybersecurity incident, the company said in a statement. Adjusted diluted earnings per share were $0.09, compared with $0.01 a year earlier.
At the same time, the company remains unprofitable on a GAAP basis.
Net revenue in the quarter fell 2.9% year over year to $392.4 million. Organic revenue declined 3.9% due to the closure of underperforming outlets.
Net revenue for the full-year 2025 decreased 8.6% to $1.5 billion.
The company is seeking to cut costs by outsourcing its logistics network and closed about 1,400 underperforming locations in the U.S. in 2025, while opening points with higher-revenue retail partners.
What analysts say
The fourth quarter “showed signs of progress in the brand’s turnaround efforts,” Citi analyst Jon Tower said, as quoted by Bloomberg. “However, growing consumer GLP-1 adoption remains a narrative overhang meaning will need to see consecutive quarters of KPI upside before coming back to the story,” Tower said. He maintains a "hold" rating on the stock.
Krispy Kreme’s business still faces a “lack of visibility on the still very much in-process emergency level pivot in the business” and remains highly leveraged, JP Morgan analyst Rahul Krotthapalli wrote in a January note. Following the earnings, JPMorgan maintained its "underweight" rating.
The company’s shares still trade nearly 40% lower than a year ago. According to MarketWatch data, three analysts currently rate Krispy Kreme stock at either "underweight" or "sell," two at "hold," and only one at "buy." The average price target is $4 per share, implying upside of about 5%.
