How did Krispy Kreme (NASDAQ:DNUT) perform in Q1 2026?

Krispy Kreme reported Q1 2026 net revenue of $367 million, a 2.2% decline from $375.3 million in Q1 2025. The decline was primarily due to the closure of underperforming retail doors and the end of its pilot program with McDonald’s. Despite the revenue drop, adjusted EBITDA rose by 38% to $33.1 million, and the GAAP net loss narrowed to $22.7 million, a $10.7 million improvement year-over-year.

What were the main factors contributing to Krispy Kreme’s revenue decline in Q1 2026?

The 2.2% revenue decline in Q1 2026 was mainly driven by two factors: the strategic closure of underperforming retail locations in late 2025 and the conclusion of Krispy Kreme’s pilot program with McDonald’s USA. Despite these factors, excluding the McDonald’s exit, systemwide sales grew 0.7% on a constant currency basis, reflecting the brand's underlying health.

How did Krispy Kreme manage its profitability in Q1 2026?

Krispy Kreme's profitability showed significant improvement in Q1 2026. Adjusted EBITDA increased by 38% to $33.1 million, reflecting stronger operational efficiency. Although the company still recorded a GAAP net loss of $22.7 million, this represented a $10.7 million improvement compared to the prior-year period. The company’s ability to improve profitability amidst challenges demonstrates effective cost control and strategic adjustments.

What was Krispy Kreme’s cash flow performance in Q1 2026?

Krispy Kreme marked a major milestone in cash generation during Q1 2026. Cash provided by operating activities surged to $20.2 million, a $41 million improvement compared to the same quarter last year when cash used in operations was negative. Free cash flow also improved significantly, rising by $58.1 million to a positive $11.4 million, reflecting strong cash flow management and operational efficiency.

How did the company’s exit from McDonald’s USA affect its performance?

The conclusion of Krispy Kreme’s pilot program with McDonald’s USA contributed to the company’s revenue decline in Q1 2026. However, the impact of the McDonald’s exit was partially offset by a 0.7% growth in systemwide sales on a constant currency basis, indicating that Krispy Kreme’s core business remains healthy despite the loss of the McDonald’s partnership.

Krispy Kreme adjusted EBITDA surges 38% as strategic closures drive profitability

Written by Isaac FrancisPublished May. 7 2026Last Updated May. 7 2026

Krispy Kreme (NASDAQ:DNUT) reported a first quarter characterized by significantly improved operational efficiency and cash flow, even as the company navigated a transition away from its large-scale partnership with McDonald’s USA.

For the quarter ended March 29, 2026, the Charlotte-based doughnut chain reported net revenue of $367 million, a 2.2% decline compared to the $375.3 million reported in the first quarter of 2025.

The revenue contraction was primarily attributed to two factors: the strategic closure of underperforming retail doors in late 2025 and the conclusion of its pilot program with McDonald’s.

However, excluding the impact of the McDonald's exit, systemwide sales grew 0.7% on a constant currency basis, reflecting the underlying health of the brand’s core "Hubs and Spokes" global network.

Despite the slight revenue decline, Krispy Kreme’s profitability metrics saw a dramatic upward shift.

Adjusted EBITDA rose 38% to $33.1 million, while the GAAP net loss narrowed significantly to $22.7 million—an $10.7 million improvement over the prior-year period.

The company also marked a major milestone in cash generation.

Cash provided by operating activities surged to $20.2 million, a $41 million swing from the cash used in the same quarter last year.

Free cash flow followed suit, improving by $58.1 million to reach a positive $11.4 million.