Core Viewpoint - Krispy Kreme's stock has experienced significant declines following disappointing Q4 earnings, leading analysts to lower their price targets substantially [1][2][3] Financial Performance - Krispy Kreme missed both revenue and earnings expectations in Q4, which has raised concerns among analysts [3] - The company's revenue guidance for 2025 is lower than its 2024 performance, contradicting previous expectations of strong demand and growth [3] Analyst Reactions - Piper Sandler analyst Brian Mullan reduced his price target for Krispy Kreme by 33% to $12 per share [2] - Morgan Stanley's analysts were more drastic, cutting their price target by 50% to $6 per share [2] Growth Concerns - The company is facing challenges due to a heavy debt load and thin profit margins, making growth essential for its investment appeal [4] - Despite potential growth opportunities, such as partnerships with McDonald's, the lack of significant sales growth is a concern for investors [4]

Financial Data and Key Metrics Changes - The company reported net revenue of $404 million for Q4 2024, marking a 21% revenue growth year-over-year, despite a $11 million revenue impact from a Cyber Security Incident [26][8][25] - Organic revenue grew by 1.8%, with an estimated 280 basis point headwind from the Cyber Security incident [27] - Adjusted EBITDA declined to $45.9 million, with an adjusted EBITDA margin of 11.4%, impacted by the Cyber Incident and the sale of a majority stake in Insomnia Cookies [27][28] Business Line Data and Key Metrics Changes - U.S. segment organic revenue declined by 1.2%, primarily due to a 460 basis point impact from the Cyber Security Incident [28] - The Delivered Fresh Daily (DFD) expansion strategy saw points of access growth accelerate to 34% year-over-year [29] - International markets reported organic revenue growth of 7.8%, led by Canada and Japan, with adjusted EBITDA of $25.7 million and an adjusted EBITDA margin of 18.6% [30][31] Market Data and Key Metrics Changes - Global points of access grew by 24%, with over 2,800 new doors added in the U.S. through national partners [15][8] - The company anticipates reaching more than 23,000 points of access by year-end 2025 [21] - The capital-light international franchise business grew points of access by 8% in 2024, with plans to open in two to four new countries in 2025 [20][21] Company Strategy and Development Direction - The company is focusing on profitable U.S. DFD expansion and wider adoption of its capital-light international franchise model [39] - Plans include evaluating refranchising certain international markets and strengthening a performance-based culture [11][22] - The marketing strategy will spotlight the Original Glazed doughnut, targeting value-conscious consumers [13][110] Management's Comments on Operating Environment and Future Outlook - Management acknowledged consumer softness and adverse weather impacts in Q1 2025, but remains optimistic about long-term growth [37][50] - The company expects revenue growth in 2025, with organic revenue growth projected at 5% to 7% [35] - Management emphasized the importance of operational efficiency and leveraging existing capacity to drive profitability [57][39] Other Important Information - The Cyber Security Incident is expected to have a limited long-term impact on the business trajectory [25] - The company plans to outsource more than half of its U.S. logistics deliveries by year-end 2025 [19] - Capital expenditures are expected to track between 6% and 7% of net revenue, with interest expenses projected between $65 million and $75 million [36] Q&A Session Summary Question: What are the expectations for OpEx expenses in 2025? - Management indicated that OpEx will be pressured in the first half of the year due to investments in operations leadership and logistics outsourcing, with expectations for leverage in the second half [44] Question: How will the company handle underperforming DFD locations? - The company will optimize low-performing doors as part of its strategy to ensure sustainable growth [47] Question: Why is the organic growth guidance lower than market expectations? - Management cited a choppy start to the year due to weather and consumer pressures, impacting traditional retail locations [50] Question: What is the impact of the Cyber Security Incident on 2025 guidance? - While not quantified, management acknowledged ongoing operational challenges from the incident affecting labor and materials management [72] Question: What are the plans for international refranchising? - The company is evaluating refranchising opportunities in several international markets to focus on expanding its U.S. footprint [90] Question: What is the expected impact of outsourcing logistics on EBITDA? - Management aims for EBIT neutrality during the transition to outsourced logistics, with potential cash benefits from negotiated payment terms [123]

Core Viewpoint - Krispy Kreme's shares declined by approximately 24% following disappointing fourth-quarter earnings and fiscal 2025 guidance [1] Financial Performance - Adjusted earnings were reported at $0.01, missing Wall Street estimates of $0.10, while revenue was $404 million, below the consensus estimate of $414 million [2] - For fiscal year 2025, the company guided revenue between $1.55 billion and $1.65 billion and adjusted earnings per share between $0.04 and $0.08, again falling short of consensus expectations [2] Revenue Growth and Challenges - The company reported organic revenue growth of about 2% year over year during the quarter [3] - A cybersecurity incident impacted online ordering, resulting in a revenue hit of $11 million and $3 million in remediation expenses [3] - The decision to sell a majority stake in Insomnia Cookies had a $101 million impact on revenue [3] Market Sentiment and Future Outlook - Despite the challenges, Krispy Kreme achieved 5% organic revenue growth in fiscal 2024 and established a new partnership with McDonald's for donut delivery, which shows potential [4] - Analysts remain optimistic about price targets for the stock, but the recent earnings report may lead to lower targets and decreased investor confidence [4] - Given concerns about consumer strength, it may be prudent to monitor the stock rather than make immediate purchases [4]

Core Insights - Krispy Kreme reported a revenue of $404.02 million for the quarter ended December 2024, reflecting a decline of 10.4% year-over-year and a surprise of -2.39% compared to the Zacks Consensus Estimate of $413.92 million [1] - The company's EPS was $0.01, down from $0.09 in the same quarter last year, resulting in an EPS surprise of -90.00% against the consensus estimate of $0.10 [1] Financial Performance - The stock has returned -2.7% over the past month, underperforming the Zacks S&P 500 composite, which saw a change of -1.8% [3] - Krispy Kreme holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance in the near term [3] Global Points of Access - Total Global Points of Access reached 17,557, slightly below the two-analyst average estimate of 17,934 [4] - U.S. Fresh Shops totaled 70, compared to the average estimate of 73 [4] - International Fresh Shops reported 519, exceeding the average estimate of 512 [4] Geographic Revenue Breakdown - Market Development revenue was $20.52 million, significantly lower than the estimated $25.27 million, representing a year-over-year decline of -57.1% [4] - International revenue was $138.39 million, surpassing the average estimate of $133.86 million, with a year-over-year increase of +29.3% [4] - U.S. revenue was $245.12 million, below the average estimate of $256.39 million, reflecting a year-over-year decrease of -17.2% [4]

Core Insights - Krispy Kreme's shares fell over 20% to an all-time low following disappointing earnings and guidance, exacerbated by a cyberattack and ongoing restructuring efforts [1][5] - The company reported fourth-quarter adjusted EPS of $0.01 on revenue of $404 million, a 10% decline year-over-year, missing analyst expectations of $0.09 EPS and $411.1 million in revenue [1][2] Revenue Impact - The revenue decline was primarily due to the sale of its majority stake in Insomnia Cookies and an $11 million negative impact from a December cyberattack, which disrupted operations including online ordering [2][5] - The company stated that online ordering and core business functions are now fully operational [2] Management and Strategic Changes - CEO Josh Charlesworth indicated that excluding the cybersecurity issue, performance was largely in line with expectations [3] - The company has restructured management teams to focus on profitable U.S. expansion and capital-light international growth, and plans to outsource U.S. logistics [3][5] - Krispy Kreme is also evaluating refranchising certain international markets [3] Future Outlook - The company projects full-year revenue between $1.55 billion and $1.65 billion, with adjusted EBITDA of $180 million to $200 million, both below analyst estimates of $1.76 billion and $235 million respectively [3]

Krispy Kreme, Inc. FOURTH QUARTER 2024 EARNINGS PRESENTATION FEBRUARY 25, 2025 Krispy Kreme | 4Q24 Earnings 1 Cautionary Note Regarding Forward-Looking Statements Certain statements made in this presentation and the conference call that this presentation accompanies are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of forward-looking terminology, including terms such as "plan," "believe," "may," ...

Full Year Highlights (vs FY 2023) EXHIBIT 99.1 Krispy Kreme reports fourth quarter and full year 2024 financial results Full Year 2024 Net Revenue of $1.7 billion and Full Year Organic Revenue growth of 5.0% Introduces 2025 guidance CHARLOTTE, NC (February 25, 2025) – Krispy Kreme, Inc. (NASDAQ: DNUT) ("Krispy Kreme", "KKI", or the "Company") today reported financial results for the fourth quarter and full year ended December 29, 2024. Fourth Quarter Highlights (vs Q4 2023) "We delivered an 18th consecutive ...

Core Insights - Krispy Kreme's shares are perceived as undervalued, especially following the recent partnership with McDonald's, which is expected to be a significant growth driver for the company [1] Company Summary - Krispy Kreme has officially launched a partnership with McDonald's, marking a pivotal moment for the business and potentially enhancing its market position [1] Analyst Background - The analysis is provided by Mitko Atanasov, who has extensive experience in finance and equity analysis, having worked for a major asset management firm in the UK [1]

Krispy Kreme said in an SEC filing that it's navigating a cybersecurity incident.The company is experiencing operational disruptions, including with online orders in the US.Krispy Kreme said the related costs will likely impact its "financial condition."Krispy Kreme said hackers had disrupted operations, including online ordering in certain parts of the United States.Advertisement In an SEC filing on Wednesday, Krispy Kreme said it learned of "unauthorized activity on a portion of its information technolog ...

Key TakeawaysKrispy Kreme reported it was hit with a cyber attack last month that has caused disruptions in its operations.The donut maker said online ordering in the U.S. has been affected.Krispy Kreme warned costs associated with the breach will negatively impact its financial results. Shares of Krispy Kreme (DNUT) fell Wednesday after the donut maker reported a recent cyber attack caused disruptions that will have a negative effect on its financial results.  The company wrote in a regulatory filing that ...