Krispy Kreme Narrows Loss on Revenue Dip
Krispy Kreme narrowed its second-quarter loss to $20.3 million, a significant improvement from the $435.3 million loss in the same period last year. The company’s revenue fell almost 13% to $331 million, beating Wall Street models of $303.4 million. Krispy Kreme’s turnaround plan is showing progress, with the company backing its outlook for revenue of $1.25 billion to $1.35 billion and adjusted EBITDA of $140 million to $150 million.
The company attributed its lower top line to its decision to exit weaker sales locations. As it closed underperforming doors, Krispy Kreme began reshaping its distribution model to prioritize sales in higher-traffic locations with retail partners such as Walmart, Target and Costco.
Krispy Kreme is also streamlining operations, having previously completed the outsourcing of deliveries to grocery and convenience partners. It is also leaning more heavily on franchising overseas, where partners shoulder much of the investment required for new shops.
“The second quarter highlighted continued significant progress on our turnaround to strengthen the balance sheet, reduce leverage, and drive sustainable, profitable growth,” Chief Executive Josh Charlesworth said.