Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________

FORM 10-Q

_________________________

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number: 001-40573

Krispy Kreme, Inc.

(Exact name of registrant as specified in its charter)

_________________________


Delaware			37-1701311
(State or other jurisdiction of incorporation)			(IRS Employer Identification No.)

2116 Hawkins Street, Charlotte, North Carolina 28203

(Address of principal executive offices)

(800) 457-4779

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

_________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common stock, $0.01 par value per share

DNUT

Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The registrant had outstanding 168.7 million shares of common stock as of April 30, 2024.

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PART I. FINANCIAL INFORMATION			Page
	Item 1.	Financial Statements (Unaudited)	1
		Condensed Consolidated Statements of Operations	1
		Condensed Consolidated Statements of Comprehensive (Loss)/Income	2
		Condensed Consolidated Balance Sheets	3
		Condensed Consolidated Statements of Changes in Shareholders’ Equity	4
		Condensed Consolidated Statements of Cash Flows	6
		Notes to Condensed Consolidated Financial Statements	7
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
	Item 4.	Controls and Procedures	38
PART II. OTHER INFORMATION
	Item 1.	Legal Proceedings	39
	Item 1A.	Risk Factors	39
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
	Item 3.	Defaults Upon Senior Securities	39
	Item 4.	Mine Safety Disclosures	39
	Item 5.	Other Information	39
	Item 6.	Exhibits	40

Signatures			41

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Krispy Kreme, Inc.

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except per share amounts)


	Quarter Ended
	March 31, 2024 (13 weeks)		April 2, 2023 (13 weeks)
Net revenues
Product sales	$	433,512	$	410,674
Royalties and other revenues	9,186		8,276
Total net revenues	442,698		418,950
Product and distribution costs	107,015		117,833
Operating expenses	205,195		191,408
Selling, general and administrative expense	71,574		61,468
Marketing expenses	12,115		9,853
Pre-opening costs	1,105		764
Other expenses/(income), net	200		(5,263)
Depreciation and amortization expense	33,586		27,939
Operating income	11,908		14,948
Interest expense, net	13,736		11,988

Other non-operating expense, net	573		999
(Loss)/income before income taxes	(2,401)		1,961
Income tax expense	4,262		317
Net (loss)/income	(6,663)		1,644
Net income attributable to noncontrolling interest	1,871		1,945
Net loss attributable to Krispy Kreme, Inc.	$	(8,534)	$	(301)
Net loss per share:
Common stock — Basic	$	(0.05)	$	0.00
Common stock — Diluted	$	(0.05)	$	0.00
Weighted average shares outstanding:
Basic	168,685		168,141
Diluted	168,685		168,141

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Condensed Consolidated Statements of Comprehensive (Loss)/Income (Unaudited)

(in thousands)


	Quarter Ended
	March 31, 2024 (13 weeks)		April 2, 2023 (13 weeks)
Net (loss)/income	$	(6,663)	$	1,644
Other comprehensive (loss)/income, net of income taxes:
Foreign currency translation adjustment	(6,069)		11,092
Unrealized loss on cash flow hedges, net of income taxes (1)	(2,684)		(2,967)

Total other comprehensive (loss)/income	(8,753)		8,125
Comprehensive (loss)/income	(15,416)		9,769
Net income attributable to noncontrolling interest	1,871		1,945
Foreign currency translation adjustment attributable to noncontrolling interest	(299)		(108)
Total comprehensive income attributable to noncontrolling interest	1,572		1,837
Comprehensive (loss)/income attributable to Krispy Kreme, Inc.	$	(16,988)	$	7,932

(1)Net of income tax benefit of $0.9 million and $1.0 million for the quarters ended March 31, 2024, and April 2, 2023, respectively.

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except per share amounts)


	As of
	(Unaudited) March 31, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	33,132	$	38,185
Restricted cash	480		429
Accounts receivable, net	57,287		59,362
Inventories	39,257		34,716
Taxes receivable	18,397		15,526
Prepaid expense and other current assets	25,461		25,363
Total current assets	174,014		173,581
Property and equipment, net	543,100		538,220
Goodwill	1,098,826		1,101,939
Other intangible assets, net	938,847		946,349
Operating lease right of use asset, net	456,810		456,964
Other assets	22,721		23,539
Total assets	$	3,234,318	$	3,240,592
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	60,326	$	54,631
Current operating lease liabilities	50,275		50,365
Accounts payable	128,555		156,488
Accrued liabilities	117,093		134,005
Structured payables	133,809		130,104
Total current liabilities	490,058		525,593
Long-term debt, less current portion	881,778		836,615

Noncurrent operating lease liabilities	454,265		454,583
Deferred income taxes, net	123,203		123,925
Other long-term obligations and deferred credits	37,127		36,093
Total liabilities	1,986,431		1,976,809
Commitments and contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 300,000 shares authorized as of both March 31, 2024 and December 31, 2023; 168,731 and 168,628 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively	1,687		1,686
Additional paid-in capital	1,449,773		1,443,591

Shareholder note receivable	(3,629)		(3,850)
Accumulated other comprehensive (loss)/income, net of income tax	(1,208)		7,246
Retained deficit	(293,430)		(278,990)
Total shareholders’ equity attributable to Krispy Kreme, Inc.	1,153,193		1,169,683
Noncontrolling interest	94,694		94,100
Total shareholders’ equity	1,247,887		1,263,783
Total liabilities and shareholders’ equity	$	3,234,318	$	3,240,592

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

(in thousands, except per share amounts)


	Common Stock			Additional Paid-in Capital		Shareholder Note Receivable		Accumulated Other Comprehensive Income/(Loss)						Retained (Deficit)/ Earnings		Noncontrolling Interest		Total
	Shares Outstanding	Amount						Foreign Currency Translation Adjustment		Unrealized Income/(Loss) on Cash Flow Hedges		Unrealized Loss on Employee Benefit Plans
Balance at December 31, 2023	168,628	$	1,686	$	1,443,591	$	(3,850)	$	1,985	$	5,629	$	(368)	$	(278,990)	$	94,100	$	1,263,783
Net (loss)/income for the quarter ended March 31, 2024	—	—		—		—		—		—		—		(8,534)		1,871		(6,663)
Other comprehensive (loss)/income for the quarter ended March 31, 2024 before reclassifications	—	—		—		—		(5,770)		367		—		—		(299)		(5,702)
Reclassification from AOCI	—	—		—		—		—		(3,051)		—		—		—		(3,051)
Capital contribution by shareholders, net of loans issued	—	—		—		232		—		—		—		—		—		232
Share-based compensation	—	—		6,986		—		—		—		—		—		—		6,986

Dividends declared on common stock and equivalents ($0.035 per share) (1)	—	—		—		—		—		—		—		(5,905)		—		(5,905)

Distribution to noncontrolling interest	—	—		—		—		—		—		—		—		(977)		(977)
Issuance of common stock upon settlement of RSUs, net of shares withheld	103	1		(805)		—		—		—		—		—		—		(804)
Other	—	—		1		(11)		—		—		—		(1)		(1)		(12)
Balance at March 31, 2024	168,731	$	1,687	$	1,449,773	$	(3,629)	$	(3,785)	$	2,945	$	(368)	$	(293,430)	$	94,694	$	1,247,887

(1)Includes a $0.035 cash dividend per common share declared in the first quarter of fiscal 2024 and expected to be paid in the second quarter of fiscal 2024.

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

(in thousands, except per share amounts)


	Common Stock			Additional Paid-in Capital		Shareholder Note Receivable		Accumulated Other Comprehensive Income/(Loss)						Retained (Deficit)/ Earnings		Noncontrolling Interest		Total
	Shares Outstanding	Amount						Foreign Currency Translation Adjustment		Unrealized Income/(Loss) on Cash Flow Hedges		Unrealized Loss on Employee Benefit Plans
Balance at January 1, 2023	168,137	$	1,681	$	1,426,105	$	(4,813)	$	(23,028)	$	14,251	$	(374)	$	(217,490)	$	102,543	$	1,298,875
Net income/(loss) for the quarter ended April 2, 2023	—	—		—		—		—		—		—		(301)		1,945		1,644
Other comprehensive income/(loss) for the quarter ended April 2, 2023 before reclassifications	—	—		—		—		11,200		(781)		—		—		(108)		10,311
Reclassification from AOCI	—	—		—		—		—		(2,186)		—		—		—		(2,186)

Share-based compensation	—	—		5,545		—		—		—		—		—		—		5,545

Dividends declared on common stock and equivalents ($0.035 per share)	—	—		—		—		—		—		—		(5,884)		—		(5,884)

Distribution to noncontrolling interest	—	—		—		—		—		—		—		—		(1,139)		(1,139)
Issuance of common stock upon settlement of RSUs, net of shares withheld	39	1		(1)		—		—		—		—		—		—		—
Other	—	—		—		(17)		—		—		—		1		—		(16)
Balance at April 2, 2023	168,176	$	1,682	$	1,431,649	$	(4,830)	$	(11,828)	$	11,284	$	(374)	$	(223,674)	$	103,241	$	1,307,150

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)


	Quarter Ended
	March 31, 2024 (13 weeks)		April 2, 2023 (13 weeks)
CASH FLOWS (USED FOR)/FROM OPERATING ACTIVITIES:
Net (loss)/income	$	(6,663)	$	1,644
Adjustments to reconcile net (loss)/income to net cash (used for)/provided by operating activities:
Depreciation and amortization expense	33,586		27,939
Deferred and other income taxes	214		(219)
Loss on extinguishment of debt	—		472
Impairment and lease termination charges	247		4,900
(Gain)/loss on disposal of property and equipment	(49)		33
Gain on sale-leaseback	—		(9,661)
Share-based compensation	6,986		5,545
Change in accounts and notes receivable allowances	113		334
Inventory write-off	411		7,115
Settlement of interest rate swap derivatives	—		7,657
Amortization related to settlement of interest rate swap derivatives	(2,955)		—
Other	788		(204)
Change in operating assets and liabilities, excluding foreign currency translation adjustments	(50,383)		(35,190)
Net cash (used for)/provided by operating activities	(17,705)		10,365
CASH FLOWS USED FOR INVESTING ACTIVITIES:
Purchase of property and equipment	(29,064)		(26,553)

Proceeds from sale-leaseback	—		10,025






Other investing activities	19		82
Net cash used for investing activities	(29,045)		(16,446)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the issuance of debt	179,500		891,698
Repayment of long-term debt and lease obligations	(132,343)		(852,144)
Payment of financing costs	—		(5,000)
Proceeds from structured payables	101,287		44,757
Payments on structured payables	(97,416)		(70,480)

Capital contribution by shareholders, net of loans issued	232		—


Distribution to shareholders	(5,902)		(5,884)
Payments for repurchase and retirement of common stock	(804)		—
Distribution to noncontrolling interest	(977)		(1,139)
Net cash provided by financing activities	43,577		1,808
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1,829)		(1,373)
Net decrease in cash, cash equivalents and restricted cash	(5,002)		(5,646)
Cash, cash equivalents and restricted cash at beginning of period	38,614		35,730
Cash, cash equivalents and restricted cash at end of period	$	33,612	$	30,084
Supplemental schedule of non-cash investing and financing activities:
Increase/(decrease) in accrual for property and equipment	$	3,913	$	(104)


Accrual for distribution to shareholders	(5,905)		(5,884)

Reconciliation of cash, cash equivalents and restricted cash at end of period:
Cash and cash equivalents	$	33,132	$	29,675
Restricted cash	480		409
Total cash, cash equivalents and restricted cash	$	33,612	$	30,084

See accompanying notes to Condensed Consolidated Financial Statements.

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Krispy Kreme, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

(dollars in thousands, unless otherwise specified)

Note 1 — Description of Business and Summary of Significant Accounting Policies

Description of Business

Krispy Kreme, Inc. (“KKI”) and its subsidiaries (collectively, the “Company” or “Krispy Kreme”) operates through its omni-channel business model to deliver fresh doughnut experiences and produce doughnuts for Doughnut Shops, Delivered Fresh Daily (“DFD”) outlets, and digital channels, expanding consumer access to the Krispy Kreme brand.

The Company has three reportable operating segments: 1) U.S., which includes all Krispy Kreme Company-owned operations in the U.S. and Insomnia Cookies Bakeries globally; 2) International, which includes all Krispy Kreme Company-owned operations in the U.K., Ireland, Australia, New Zealand, Mexico, Canada, and Japan; and 3) Market Development, which includes franchise operations across the globe. Unallocated corporate costs are excluded from the Company’s measurement of segment performance.

Basis of Presentation and Consolidation

The Company operates and reports financial information on a 52 or 53-week year with the fiscal year ending on the Sunday closest to December 31. The data periods contained within fiscal years 2023 and 2024 will reflect the results of operations for the 52-week periods ended December 31, 2023 and December 29, 2024, respectively. The quarters ended March 31, 2024 and April 2, 2023 were both 13-week periods.

The unaudited Condensed Consolidated Financial Statements include the accounts of KKI and subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, these interim financial statements do not include all information and footnotes required under GAAP for complete financial statements. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of results of operations, balance sheet, cash flows, and shareholders’ equity for the periods presented. All significant intercompany balances and transactions among KKI and subsidiaries have been eliminated in consolidation. Investments in entities over which the Company has the ability to exercise significant influence but which it does not control and whose financial statements are not otherwise required to be consolidated, are accounted for using the equity method.

These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto as of and for the year ended December 31, 2023, included in the Annual Report on Form 10-K. The Condensed Consolidated Balance Sheet as of December 31, 2023 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The results of operations for the quarter ended March 31, 2024 are not necessarily indicative of the results of operations that may be achieved for the entire fiscal year ending December 29, 2024.

Noncontrolling interest in the Company’s Condensed Consolidated Financial Statements represents the interest in subsidiaries held by joint venture partners and employee shareholders. The joint venture partners hold noncontrolling interests in the Company’s consolidated subsidiaries, Awesome Doughnut, LLC (“Awesome Doughnut”), W.K.S. Krispy Kreme, LLC (“WKS Krispy Kreme”), and Krispy K Canada, Inc. (“KK Canada”). Employee shareholders hold noncontrolling interests in the consolidated subsidiaries Krispy Kreme Holding U.K. Ltd. (“KK U.K.”), Krispy Kreme Holdings Pty Ltd. (“KK Australia”), Krispy Kreme Mexico Holding S.A.P.I. de C.V. (“KK Mexico”), and Insomnia Cookies Holdings, LLC (“Insomnia Cookies”). Since the Company consolidates the financial statements of these subsidiaries, the noncontrolling owners’ share of each subsidiary’s net assets and results of operations are deducted and reported as noncontrolling interest on the Condensed Consolidated Balance Sheets and as net income attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations and comprehensive income attributable to noncontrolling interest in the Condensed Consolidated Statements of Comprehensive (Loss)/Income.

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Summary of Significant Accounting Policies

The Company’s significant accounting policies are described in Note 1, “Description of Business and Summary of Significant Accounting Policies” to the Consolidated Financial Statements for the year ended December 31, 2023 included in the Annual Report on Form 10-K. There have been no material changes to the significant accounting policies during the quarter ended March 31, 2024.

Reclassifications

Segment information is prepared on the same basis that the Company’s management reviews financial information for operational decision-making purposes. Effective January 1, 2024, the Company realigned its segment reporting structure such that the Company-owned Canada and Japan businesses have moved from the Market Development reportable operating segment to the International reportable operating segment. All segment information has been restated to be consistent with current presentation.

Recent Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires a public entity to disclose the title and position of the Chief Operating Decision Maker. The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. A public entity should apply the amendments in this standard retrospectively to all prior periods presented in the financial statements. We expect this standard to impact our segment disclosures, but with no impacts to our results of operations, cash flows, and financial condition.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which focuses on the rate reconciliation and income taxes paid disclosures. The standard requires a public business entity (“PBE”) to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further disaggregated by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state, and foreign and by individual jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. For PBEs, the standard is effective for annual periods beginning after December 15, 2024, with early adoption permitted. An entity should apply the amendments in this standard prospectively, with retrospective application permitted. We expect this standard to impact our income tax disclosures, but with no impacts to our results of operations, cash flows, and financial condition.

Note 2 — Inventories

The components of Inventories are as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	23,594	$	21,000
Work in progress	470		211
Finished goods and purchased merchandise	15,193		13,505
Total inventories	$	39,257	$	34,716

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Note 3 — Goodwill and Other Intangible Assets, net

Goodwill

Changes in the carrying amount of goodwill by reportable segment are as follows:


	U.S.		International		Market Development		Total
Balance as of December 31, 2023	$	677,956	$	294,468	$	129,515	$	1,101,939


Foreign currency impact	—		(3,113)		—		(3,113)
Balance as of March 31, 2024	$	677,956	$	291,355	$	129,515	$	1,098,826

Other Intangible Assets, net

Other intangible assets consist of the following:


	March 31, 2024						December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Amount		Gross Carrying Amount		Accumulated Amortization		Net Amount
Intangible assets with indefinite lives
Trade names and trademarks	$	657,990	$	—	$	657,990	$	657,980	$	—	$	657,980
Intangible assets with definite lives
Franchise agreements	30,390		(11,107)		19,283		30,390		(10,744)		19,646
Customer relationships	15,000		(6,629)		8,371		15,000		(6,413)		8,587
Reacquired franchise rights (1)	396,822		(143,619)		253,203		397,279		(137,143)		260,136

Total intangible assets with definite lives	442,212		(161,355)		280,857		442,669		(154,300)		288,369
Total intangible assets	$	1,100,202	$	(161,355)	$	938,847	$	1,100,649	$	(154,300)	$	946,349

(1)Reacquired franchise rights include the impact of foreign currency fluctuations associated with the respective countries.

Amortization expense related to intangible assets included in depreciation and amortization expense was $7.4 million for the quarter ended March 31, 2024, and $7.3 million for the quarter ended April 2, 2023.

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Note 4 — Leases

The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:


		As of
		March 31, 2024		December 31, 2023
Assets	Classification
Operating lease	Operating lease right of use asset, net	$	456,810	$	456,964
Finance lease	Property and equipment, net	42,140		41,411
Total leased assets		$	498,950	$	498,375
Liabilities
Current
Operating lease	Current operating lease liabilities	$	50,275	$	50,365
Finance lease	Current portion of long-term debt	8,326		8,631
Noncurrent
Operating lease	Noncurrent operating lease liabilities	454,265		454,583
Finance lease	Long-term debt, less current portion	39,637		38,486
Total leased liabilities		$	552,503	$	552,065

Lease costs were as follows:


		Quarter Ended
		March 31, 2024		April 2, 2023
Lease cost	Classification
Operating lease cost	Selling, general and administrative expense	$	935	$	891
Operating lease cost	Operating expenses	24,023		22,390
Short-term lease cost	Operating expenses	1,085		1,281
Variable lease costs	Operating expenses	7,433		9,345
Sublease income	Royalties and other revenues	(35)		(35)
Finance lease cost:
Amortization of right of use assets	Depreciation and amortization expense	$	2,921	$	1,584
Interest on lease liabilities	Interest expense, net	877		573

Supplemental disclosures of cash flow information related to leases were as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)	$	31,124	$	29,145
Operating cash flows for finance leases	864		549
Financing cash flows for finance leases	2,593		1,696
Right of use assets obtained in exchange for new lease liabilities:
Operating leases	$	13,114	$	26,850
Finance leases	3,158		1,421

(1)Operating cash flows from operating leases include variable rent payments which are not included in the measurement of lease liabilities. Variable rent payments were $7.4 million and $9.3 million for the quarters ended March 31, 2024 and April 2, 2023, respectively.

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There were no lease termination charges in the quarter ended March 31, 2024. The Company recognized a net gain of $0.9 million included in Other expenses/(income), net on the Condensed Consolidated Statement of Operations in the quarter ended April 2, 2023, related to the termination of leases at certain Krispy Kreme shops in the U.S. where the Company had already recognized impairment of the corresponding right of use assets in a prior period.

There were no sale-leaseback transactions completed in the quarter ended March 31, 2024. In the quarter ended April 2, 2023, the Company completed a sale-leaseback transaction whereby it disposed of the land at one real estate property for proceeds of $10.0 million. The Company subsequently leased back the property, which is accounted for as an operating lease. The Company recognized a gain on sale of $9.7 million, which is included in Other expenses/(income), net on the Condensed Consolidated Statement of Operations for the quarter ended April 2, 2023.

Note 5 — Fair Value Measurements

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:


	March 31, 2024
		Level 2
Assets:

Interest rate derivatives		$	972
Commodity derivatives		341

Total Assets		$	1,313

Liabilities:
Foreign currency derivatives		$	599
Total Liabilities		$	599


	December 31, 2023
		Level 2
Assets:

Interest rate derivatives		$	1,596

Total Assets		$	1,596

Liabilities:
Foreign currency derivatives		$	345
Commodity derivatives		113
Total Liabilities		$	458

There were no assets or liabilities measured using Level 1 and Level 3 inputs and no transfers of financial assets or liabilities among the levels within the fair value hierarchy during the quarter ended March 31, 2024 and fiscal year ended December 31, 2023. The Company’s derivatives are valued using discounted cash flow analyses that incorporate observable market parameters, such as interest rate yield curves and currency rates.

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Note 6 — Derivative Instruments

Commodity Price Risk

The Company uses forward contracts to protect against the effects of commodity price fluctuations in the cost of ingredients of its products, of which flour, sugar, and shortening are the most significant, and the cost of gasoline used by its delivery vehicles. Management has not designated these forward contracts as hedges. As of March 31, 2024 and December 31, 2023, the total notional amount of commodity derivatives was 1.4 million and 1.8 million gallons of fuel, respectively. They are scheduled to mature between April 2024 and December 2024 and January 2024 and December 2024, respectively. As of March 31, 2024 and December 31, 2023, the Company recorded an asset of $0.3 million and a liability of $0.1 million, respectively, related to the fair market values of its commodity derivatives. The settlement of commodity derivative contracts is reported in the Condensed Consolidated Statements of Cash Flows as a cash flow from operating activities.

Interest Rate Risk

The Company uses interest rate swaps to manage its exposure to interest rate volatility from its debt arrangements. Management has designated the swap agreements as cash flow hedges and recognized the changes in the fair value of these swaps in other comprehensive income. As of March 31, 2024 and December 31, 2023, the Company has recorded assets of $1.0 million and $1.6 million, respectively, related to the fair market values of its interest rate derivatives. The cash flows associated with the interest rate swaps are reflected in operating activities in the Condensed Consolidated Statements of Cash Flows, which is consistent with the classification as operating activities of the interest payments on the term loan.

In the quarter ended April 2, 2023, the Company cancelled certain interest rate swap agreements with an aggregate notional amount of $265.0 million, collecting $7.7 million in cash proceeds, and entered into new agreements with the same counterparties. The primary difference between these new agreements and the prior versions included the setting of a new payment rate on the fixed component of the swaps (4.38%). At the same time, the Company also amended the benchmark interest rate on the floating component of all $505.0 million hedged notional to one-month SOFR, corresponding to the new interest rate on its credit facility discussed in Note 8, Long-Term Debt.

The net effect of the interest rate swap arrangements will be to fix the interest rate on the term loan under the 2023 Facility up to the notional amount outstanding at the rates payable under the swap agreements plus the Applicable Rate (as defined by the 2023 Facility), through the swap maturity dates in June 2024.

Foreign Currency Exchange Rate Risk

The Company is exposed to foreign currency risk primarily from its investments in consolidated subsidiaries that operate in Canada, the U.K., Ireland, Australia, New Zealand, Mexico, and Japan. In order to mitigate the impact of foreign exchange fluctuations on commercial and financial transactions with these subsidiaries, the Company enters into foreign exchange forward contracts. Management has not designated these forward contracts as hedges. As of March 31, 2024 and December 31, 2023, the total notional amount of foreign exchange derivatives was $50.1 million and $49.8 million, respectively. They matured in April 2024 and January 2024, respectively. The Company recorded liabilities of $0.6 million and $0.3 million as of March 31, 2024 and December 31, 2023, respectively, related to the fair market values of its foreign exchange derivatives.

Quantitative Summary of Derivative Positions and Their Effect on Results of Operations

The following tables present the fair values of derivative instruments included in the Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023, for derivatives not designated as hedging instruments and derivatives designated as hedging instruments, respectively. The Company only has cash flow hedges that are designated as hedging instruments.


	Derivatives Fair Value
Derivatives Not Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location

Commodity derivatives	$	341	$	—	Prepaid expense and other current assets
Total Assets	$	341	$	—
Foreign currency derivatives	$	599	$	345	Accrued liabilities
Commodity derivatives	—		113		Accrued liabilities
Total Liabilities	$	599	$	458

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	Derivatives Fair Value
Derivatives Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location
Interest rate derivatives	$	972	$	1,596	Prepaid expense and other current assets

Total Assets	$	972	$	1,596

The effect of derivative instruments on the Condensed Consolidated Statements of Operations for the quarters ended March 31, 2024 and April 2, 2023 is as follows:


	Derivative Gain Recognized in Income for the Quarter Ended
Derivatives Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative Gain Recognized in Income
Gain on interest rate derivatives	$	3,051	$	2,186	Interest expense, net
	$	3,051	$	2,186


	Derivative (Loss)/Gain Recognized in Income for the Quarter Ended
Derivatives Not Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative (Loss)/Gain Recognized in Income
Loss on foreign currency derivatives	$	(254)	$	(924)	Other non-operating expense, net
Gain/(loss) on commodity derivatives	454		(118)		Other non-operating expense, net
	$	200	$	(1,042)

Note 7 — Vendor Finance Programs

The following table presents liabilities related to vendor finance programs which the Company participates in as a buyer as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Supply chain financing programs	$	29,622	$	51,239	Accounts payable
Structured payables programs	133,809		130,104		Structured payables
Total Liabilities	$	163,431	$	181,343

Supply Chain Financing (“SCF”) Programs

The Company has an agreement with a third-party administrator which allows participating vendors to track its payments, and if voluntarily elected by the vendor, to sell payment obligations from the Company to financial institutions as part of the SCF program. The Company’s typical payment terms for trade payables range up to 180 days outside of the SCF program, depending on the type of vendors and the nature of the supplies or services. For vendors under the SCF Program, the Company has established payable terms ranging up to, but not exceeding, 360 days. When participating vendors elect to sell one or more of the Company’s payment obligations, the Company’s rights and obligations to settle the payables on their contractual due date are not impacted. The Company has no economic or commercial interest in a vendor’s decision to enter into these agreements and the financial institutions do not provide the Company with incentives such as rebates or profit sharing under the SCF program. The Company agrees on commercial terms with vendors for the goods and services procured, which are consistent with payment terms observed at other peer companies in the industry, and as the terms are not impacted by the SCF program, such obligations are classified as Accounts payable on the Condensed Consolidated Balance Sheets and the associated cash flows are included in operating activities in the Condensed Consolidated Statements of Cash Flows.

Structured Payables Programs

The Company utilizes various card products issued by financial institutions to facilitate purchases of goods and services. By using these products, the Company may receive differing levels of rebates based on timing of repayment. The payment obligations under these card products are classified as Structured payables on the Condensed Consolidated Balance Sheets and the associated cash flows are included in financing activities in the Condensed Consolidated Statements of Cash Flows.

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Note 8 — Long-Term Debt

The Company’s long-term debt obligations consists of the following:


	March 31, 2024		December 31, 2023
2023 Facility — term loan	$	673,750	$	682,500
2023 Facility — revolving credit facility	207,500		155,000
Short-term lines of credit	17,000		11,000


Less: Debt issuance costs	(4,109)		(4,371)
Finance lease obligations	47,963		47,117
Total long-term debt	942,104		891,246
Less: Current portion of long-term debt	(60,326)		(54,631)
Long-term debt, less current portion	$	881,778	$	836,615

2023 Secured Credit Facility

The Company is party to a credit agreement (the “2023 Facility”) consisting of a $300.0 million senior secured revolving credit facility and a term loan with a principal amount of $700.0 million. The 2023 Facility is secured by a first priority lien on substantially all of the Company’s personal property assets, certain real properties, and all of the Company’s domestic wholly owned subsidiaries. Loans made pursuant to the 2023 Facility may be used for general corporate purposes of the Company (including, but not limited to, financing working capital needs, capital expenditures, acquisitions, other investments, dividends, and stock repurchases) and for any other purpose not prohibited under the related loan documents.

Borrowings under the 2023 Facility are generally subject to an interest rate of adjusted term SOFR plus a credit spread adjustment of 0.10% plus (i) 2.25% if the Company’s leverage ratio (as defined in the 2023 Facility) equals or exceeds 4.00 to 1.00, (ii) 2.00% if the Company’s leverage ratio is less than 4.00 to 1.00 but greater than or equal to 3.00 to 1.00, or (iii) 1.75% if the Company’s leverage ratio is less than 3.00 to 1.00. As of March 31, 2024 and December 31, 2023, the unhedged interest rate was 7.43% and 7.46% under the 2023 Facility, respectively. As of March 31, 2024 and December 31, 2023, $505.0 million out of the $673.8 million term loan balance and $505.0 million out of the $682.5 million term loan balance, respectively, was hedged. The effective interest rate on the term loan was approximately 6.78% and 6.80% for the quarter ended March 31, 2024 and fiscal year ended December 31, 2023, respectively. The Company is required to make equal installments of 1.25% of the aggregate closing date principal amount of the term loan on the last day of each fiscal quarter. All remaining term loan and revolving loan balances are to be due at maturity in March 2028.

Short-Term Lines of Credit

The Company is party to two agreements with existing lenders providing for short-term, uncommitted lines of credit up to $25.0 million. Borrowings under these short-term lines of credit are payable to the lenders on a revolving basis for tenors up to a maximum of three months and are subject to an interest rate of adjusted term SOFR plus a credit spread adjustment of 0.10% plus a margin of 1.75%.

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Note 9 — Share-based Compensation

Restricted Stock Units (“RSUs”) and Performance Stock Units (“PSUs”)

The Company and certain of its subsidiaries issue time-vested RSUs and PSUs under their respective executive ownership plans and long-term incentive plans.

RSU and PSU activity under the Company’s various plans during the periods presented is as follows:


(in thousands, except per share amounts)	Non-vested shares outstanding at December 31, 2023		Granted	Vested	Forfeited	Non-vested shares outstanding at March 31, 2024
KKI
RSUs and PSUs	6,785		104	164	88	6,637
Weighted Average Grant Date Fair Value	$	14.54	13.52	14.75	15.11	$	14.51
KK U.K.
RSUs	7		—	—	—	7
Weighted Average Grant Date Fair Value	$	29.80	—	—	—	$	29.80
Insomnia Cookies
RSUs	47		—	2	—	45
Weighted Average Grant Date Fair Value	$	120.21	—	74.12	—	$	122.42
KK Australia
RSUs	185		—	—	—	185
Weighted Average Grant Date Fair Value	$	1.57	—	—	—	$	1.57
KK Mexico
RSUs	20		—	—	—	20
Weighted Average Grant Date Fair Value	$	30.18	—	—	—	$	30.18

The Company recorded total non-cash compensation expense related to RSUs and PSUs under the plans of $6.1 million and $4.7 million for the quarters ended March 31, 2024, and April 2, 2023, respectively, which is included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

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The unrecognized compensation cost related to the unvested RSUs and PSUs and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	53,665	2.9 years
KK U.K.	94		2.2 years
Insomnia Cookies	3,355		0.9 years
KK Australia	74		1.3 years
KK Mexico	231		1.4 years

The estimated fair value of restricted stock is calculated using a market approach (i.e., market multiple is used for the KK U.K. and Insomnia Cookies plans and an agreed-upon EBITDA buyout multiple is used for KK Australia and KK Mexico plans).

Time-Vested Stock Options

KKI issues time-vested stock options under its Omnibus Incentive Plan. The fair value of time-vested stock options was estimated on the date of grant using the Black-Scholes option pricing model.

A summary of the status of the time-vested stock options as of March 31, 2024 (with no options granted, exercised, or forfeited since December 31, 2023) is presented below:


	Share options outstanding at
(in thousands, except per share amounts)	March 31, 2024
KKI
Options	2,993
Weighted Average Grant Date Fair Value	$	5.90
Weighted Average Exercise Price	$	14.30

The Company recorded total non-cash compensation expense related to the time-vested stock options of $0.9 million and $0.9 million for the quarters ended March 31, 2024 and April 2, 2023, respectively, which is included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

The unrecognized compensation cost related to the unvested stock options and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	7,311	2.1 years

No time-vested stock options under the KKI plan vested during the fiscal periods presented.

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Note 10 — Income Taxes

For interim tax reporting, the Company estimates a worldwide annual effective tax rate and applies that rate to the year-to-date ordinary (loss)/income. The tax effects of significant unusual or infrequently occurring items are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur.

The Company’s effective income tax rates were -177.5% and 16.2% for the quarters ended March 31, 2024 and April 2, 2023, respectively. The Company’s effective income tax rate for the quarter ended March 31, 2024 differed from the respective statutory rates primarily due to disallowed executive compensation expense, the mix of income and taxes attributable to foreign jurisdictions, and noncontrolling interest in domestic joint ventures. The Company’s effective income tax rate for the quarter ended April 2, 2023 differed from the respective statutory rates primarily due to disallowed executive compensation expense, the mix of income and taxes attributable to foreign jurisdictions, and a discrete tax benefit unrelated to ongoing operations.

Note 11 — Commitments and Contingencies

Pending Litigation

In March 2023, an employee filed a lawsuit on behalf of himself and all others similarly situated against the Company, alleging violations of the Illinois Biometric Information Privacy Act. In May 2023, the Company moved for a stay pending resolution of a similar case before the Illinois Supreme Court. The Company believes that it has meritorious defenses to the complaint and will vigorously defend against these claims. The Company has accrued an immaterial amount and management does not believe that this matter will have a material adverse effect on the Company’s financial results.

Other Legal Matters

The Company also is engaged in various legal proceedings arising in the normal course of business. The Company maintains insurance policies against certain kinds of such claims and suits, including insurance policies for workers’ compensation and personal injury, all of which are subject to deductibles. While the ultimate outcome of these matters could differ from management’s expectations, management currently does not believe their resolution will have a material adverse effect on the Company’s Condensed Consolidated Financial Statements.

Other Commitments and Contingencies

The Company’s primary banks issued letters of credit on its behalf totaling $13.3 million and $15.4 million as of March 31, 2024 and December 31, 2023, respectively, a majority of which secure the Company’s reimbursement obligations to insurers under its self-insurance arrangements.

Note 12 — Related Party Transactions

The Company has an equity ownership in three franchisees, KremeWorks USA, LLC (20% ownership), KremeWorks Canada, L.P. (25% ownership), and Krispy Kreme Doughnuts France SAS (“KK France”) (33% ownership), with an aggregate carrying value of $2.3 million and $2.8 million as of March 31, 2024 and December 31, 2023, respectively.

Note 13 — Revenue Recognition

Disaggregation of Revenues

Revenues are disaggregated as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Company Shops, DFD and Branded Sweet Treats	$	420,213	$	392,814
Mix and equipment revenue from franchisees	13,299		17,860
Franchise royalties and other	9,186		8,276
Total net revenues	$	442,698	$	418,950

Other revenues include advertising fund contributions from franchisees, rental income, development and franchise fees, and licensing royalties from customers for use of the Krispy Kreme brand, such as Keurig coffee cups.

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Contract Balances

Deferred revenue and related receivables are as follows:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Trade receivables, net of allowances of $450 and $564, respectively	$	50,212	$	45,858	Accounts receivables, net
Deferred revenue:
Current	$	21,772	$	22,066	Accrued liabilities
Noncurrent	7,714		6,005		Other long-term obligations and deferred credits
Total deferred revenue	$	29,486	$	28,071

Trade receivables relate primarily to payments due for royalties, franchise fees, advertising fees, sale of products, and licensing fees. Deferred revenue primarily represents the Company’s remaining performance obligations under gift cards and franchise and development agreements for which consideration has been received or is receivable and is generally recognized on a straight-line basis over the remaining term of the related agreement. The noncurrent portion of deferred revenue primarily relates to the remaining performance obligations in the franchise and development agreements.

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Note 14 — Net Loss per Share

The following table presents the calculations of basic and diluted EPS:


	Quarter Ended
(in thousands, except per share amounts)	March 31, 2024		April 2, 2023
Net loss attributable to Krispy Kreme, Inc.	$	(8,534)	$	(301)


Additional income attributed to noncontrolling interest due to subsidiary potential common shares	(19)		(10)
Net loss attributable to common shareholders - Diluted	$	(8,553)	$	(311)
Basic weighted average common shares outstanding	168,685		168,141
Dilutive effect of outstanding common stock options, RSUs, and PSUs	—		—
Diluted weighted average common shares outstanding	168,685		168,141
Loss per share attributable to common shareholders:
Basic	$	(0.05)	$	0.00
Diluted	$	(0.05)	$	0.00

Potential dilutive shares consist of unvested RSUs and PSUs, calculated using the treasury stock method. The calculation of dilutive shares outstanding excludes certain unvested RSUs granted under certain subsidiaries’ executive ownership plans and long-term incentive plans, because their inclusion would have been antidilutive.

The following table summarizes the gross number of potential dilutive unvested RSUs and PSUs excluded due to antidilution (unadjusted for the treasury stock method):


	Quarter Ended
(in thousands)	March 31, 2024	April 2, 2023
KKI	6,637	5,097
KK U.K.	7	7
Insomnia Cookies	—	—
KK Australia	185	276
KK Mexico	—	—

For both quarters ended March 31, 2024 and April 2, 2023, all 3.0 million time-vested stock options were excluded from the computation of diluted weighted average common shares outstanding based on application of the treasury stock method.

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Note 15 — Segment Reporting

The Company conducts business through the three reportable segments: U.S., International, and Market Development. Unallocated corporate costs are excluded from the Company’s measurement of segment performance. These costs include general corporate expenses.

As discussed in Note 1, Description of Business and Summary of Significant Accounting Policies, effective January 1, 2024, the Company realigned its segment reporting structure such that the Company-owned Canada and Japan businesses have moved from the Market Development reportable operating segment to the International reportable operating segment. All segment information has been restated to be consistent with current presentation.

The reportable segment results are as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Net revenues:
U.S.	$	295,935	$	281,344
International	124,750		111,988
Market Development	22,013		25,618
Total net revenues	$	442,698	$	418,950

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	Quarter Ended
	March 31, 2024		April 2, 2023
Segment Adjusted EBITDA:
U.S.	$	42,616	$	38,535
International	20,536		18,982
Market Development	11,900		11,551
Corporate	(16,864)		(14,140)
Adjusted EBITDA	58,188		54,928
Interest expense, net	13,736		11,988

Income tax expense	4,262		317
Depreciation and amortization expense	33,586		27,939
Share-based compensation	6,986		5,545
Employer payroll taxes related to share-based compensation	43		25
Other non-operating expense, net (1)	573		999
Strategic initiatives (2)	4,821		13,469
Acquisition and integration expenses (3)	248		91
New market penetration expenses (4)	466		94
Shop closure expenses/(income), net (5)	139		(679)
Restructuring and severance expenses (6)	6		580

Gain on sale-leaseback	—		(9,661)
Other (7)	(15)		2,577
Net (loss)/income	$	(6,663)	$	1,644

(1)Primarily foreign translation gains and losses in each period.

(2)The quarter ended March 31, 2024 consists primarily of costs associated with global transformation, exploring strategic alternatives for the Insomnia Cookies business, and preparing for the McDonald’s U.S. expansion (with these specific initiatives aggregating to approximately $4.6 million of the total). The quarter ended April 2, 2023 consists primarily of costs associated with the decision to exit the Branded Sweet Treats business, including property, plant and equipment impairments, inventory write-offs, employee severance, and other related costs (approximately $13.4 million of the total).

(3)Consists of acquisition and integration-related costs in connection with the Company’s business and franchise acquisitions, including legal, due diligence, and advisory fees incurred in connection with acquisition and integration-related activities for the applicable period.

(4)Consists of start-up costs associated with entry into new countries for which the Company’s brands have not previously operated, including the Insomnia Cookies brand entering Canada and the U.K.

(5)Includes lease termination costs, impairment charges, and loss on disposal of property, plant and equipment. The quarter ended April 2, 2023 includes gains related to the termination of leases at certain Krispy Kreme shops in the U.S. where the Company had already recognized impairment of the corresponding right of use assets in a prior period.

(6)The quarter ended April 2, 2023 consists primarily of costs associated with restructuring of the global executive team.

(7)The quarters ended March 31, 2024 and April 2, 2023 consist primarily of legal and other regulatory expenses incurred outside the ordinary course of business. The regulatory expenses incurred in the quarter ended April 2, 2023 relate to previous business acquisitions.

Note 16 — Subsequent Events

The Company evaluated subsequent events and transactions for potential recognition or disclosure in the Condensed Consolidated Financial Statements through May 9, 2024, the date the Condensed Consolidated Financial Statements were available to be issued. All subsequent events requiring recognition and disclosure have been incorporated into these Condensed Consolidated Financial Statements.

On April 30, 2024, the Company’s Board of Directors declared a $0.035 per share cash dividend payable on August 7, 2024, to shareholders of record on July 24, 2024.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited Condensed Consolidated Financial Statements and related notes included elsewhere in this Quarterly Report on Form 10-Q, as well as our audited Consolidated Financial Statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2023, and in other reports filed subsequently with the SEC.

Cautionary Note Regarding Forward-Looking Statements

This report contains forward-looking statements that involve risks and uncertainties. The words “believe,” “may,” “could,” “will,” “should,” “anticipate,” “estimate,” “expect,” “outlook,” “guidance,” or similar words, or the negative of these words, identify forward-looking statements. Such forward-looking statements are based on certain assumptions and estimates that we consider reasonable but are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are, or will be, important factors that could cause our actual results to differ materially from those indicated in these statements. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates or expectations contemplated by us will be achieved. Our actual results could differ materially from the forward-looking statements included herein. Factors that could cause actual results to differ from those expressed in forward-looking statements include, without limitation, the risks and uncertainties described under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, filed by us with the SEC and described in the other filings we make from time to time with the SEC. We believe that these factors include, but are not limited to, the impact of pandemics, changes in consumer preferences, the impact of inflation, and our ability to execute on our omni-channel business strategy. These forward-looking statements are made only as of the date of this document, and we do not undertake any obligation, other than as may be required by applicable law, to update or revise any forward-looking or cautionary statement to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, or changes in future operating results over time or otherwise.

Overview

Krispy Kreme is one of the most beloved and well-known sweet treat brands in the world. Krispy Kreme operates in 39 countries with our transformational omni-channel strategy, which focuses on delivering fresh doughnuts such as our iconic Original Glazed® doughnut, which is universally recognized for its hot-off-the-line, melt-in-your-mouth experience, to where our consumers are located and want to have access to them. Global Points of Access are a key metric and we define them as our unique network of fresh Doughnut Shops, partnerships with leading retailers (DFD Doors), and a rapidly growing digital business. Our purpose of touching and enhancing lives through the joy that is Krispy Kreme guides how we operate every day and is reflected in the love we have for our people, our communities, and the planet.

The following table presents a summary of our financial results for the periods presented:


	Quarter Ended
(in thousands, except percentages)	March 31, 2024		April 2, 2023		% Change
Net Revenues (1)	$	442,698	$	418,950	5.7	%
Net Loss Attributable to Krispy Kreme, Inc.	(8,534)		(301)		-2,735.2	%
Adjusted Net Income, Diluted (2)	11,321		15,261		-25.8	%
Adjusted EBITDA (2)	58,188		54,928		5.9	%

(1)We generated 6.7% organic revenue growth for the quarter ended March 31, 2024.

(2)Refer to “Key Performance Indicators and Non-GAAP Measures” below for more information as to how we define and calculate Adjusted EBITDA and Adjusted Net Income, Diluted and for a reconciliation of Adjusted EBITDA and Adjusted Net Income, Diluted to the most comparable GAAP measure.

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Significant Events and Transactions

Executing on our Omni-Channel Strategy

We made strong progress on the execution of our omni-channel strategy in the first quarter of fiscal 2024, as we continue to add quality Global Points of Access across our network and convert markets into fully implemented Hub and Spoke models (refer to “Key Performance Indicators and Non-GAAP Measures” below for more information as to how we define the Hub and Spoke model). We added 667 new Global Points of Access in the first quarter of fiscal 2024 to reach 14,814 Global Points of Access. The primary driver of the increased Global Points of Access during the first quarter was the continued expansion of our DFD network in alignment with our transformation strategy, as we added 605 DFD Doors globally, including 390 DFD Doors to the U.S. segment. The increase in DFD Doors is the result of our focus on executing our omni-channel strategy to drive our transformation, and includes expansion with key customers. We expect DFD growth to continue to be one of our most significant drivers of earnings growth, primarily through increased door count and also through optimization of revenue per door. Deployment of the omni-channel strategy in the U.S. led to our trailing four quarters Sales per Hub increasing by 6.5% from $4.6 million in the first quarter of fiscal 2023 to a record high $4.9 million in the first quarter of fiscal 2024. The increase in our Sales per Hub contributed to U.S. segment organic revenue growth of 7.4% and Adjusted EBITDA margin expansion of 70 basis points to 14.4% in the first quarter of fiscal 2024. Our goal is to continue to grow our Sales per Hub over time, which we believe will drive higher margins and higher return on invested capital.

In addition to grocery and convenience stores, we are also expanding in DFD channels such as Quick Service Restaurant (“QSR”), club membership, and drug stores to further broaden availability of our doughnuts to consumers. This includes our recently announced QSR partnership with McDonald’s. Following a successful pilot at approximately 160 McDonald’s shops in Louisville and Lexington, Kentucky and the surrounding area, we entered into an agreement to work with McDonald’s to develop a deployment schedule for a U.S. national rollout of the sale of Krispy Kreme doughnuts at McDonald’s restaurants. The deployment schedule will set forth the anticipated launch period for each McDonald’s business unit in the U.S., with phasing expected through the end of fiscal 2026. The agreement does not guarantee us any particular level of business unit deployment, sales, or profits.

Growing our Global Presence

Another key strategic initiative on our journey to become the Most Loved Sweet Treat Brand in the World is to increase our global presence, focusing on the percentage of our revenues and Adjusted EBITDA generated outside the U.S. We expect to open in three to five new countries in fiscal 2024, with a key focus in Western Europe and select Asian and South American countries. We recently entered into agreements with franchise partners in Brazil and Germany, with shop openings expected in the future. We expect to have further announcements throughout the year as we grow our global business.

Digital, Brand, and Innovation

Digital channel sales represented a record 23.0% of our Doughnut Shop and Cookie Bakery sales (excluding DFD) for the first quarter of fiscal 2024, up from 19.6% in the same quarter last year. Our growth in digital is due to our focus on owned channel improvements and increasing product availability through third parties.

Innovation is a significant driver of frequency as we create and introduce premium and buzz-worthy offerings to consumers across our Global Points of Access. During the first quarter of fiscal 2024 we delivered the joy that is Krispy Kreme through powerful specialty doughnuts and seasonal activations including Chocomania with HERSHEY’S, Valentine’s Day, and Saint Patrick’s Day, among many others around the world.

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Segment Reclassifications

As discussed in Note 1, Description of Business and Summary of Significant Accounting Policies to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, effective January 1, 2024, we realigned our segment reporting structure such that the Company-owned Canada and Japan businesses have moved from the Market Development reportable operating segment to the International reportable operating segment. All segment information has been restated to be consistent with current presentation.

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Key Performance Indicators and Non-GAAP Measures

We monitor the key business metrics and non-GAAP metrics set forth below to help us evaluate our business and growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts, and assess operational efficiencies. The calculation of the key business metrics discussed below may differ from other similarly titled metrics used by other companies, securities analysts, or investors.

Throughout this Quarterly Report on Form 10-Q, we utilize “Global Points of Access” as a key performance indicator. Global Points of Access reflect all locations at which fresh doughnuts or cookies can be purchased. We define Global Points of Access to include all Hot Light Theater Shops, Fresh Shops, Carts and Food Trucks, DFD Doors, Cookie Bakeries, and other defined points at both Company-owned and franchise locations as of the end of the respective reporting period. We monitor Global Points of Access as a metric that informs the growth of our omni-channel presence over time and believe this metric is useful to investors to understand our footprint in each of our segments and by asset type.

The following table presents our Global Points of Access, by segment and type, as of the end of the first quarter of fiscal 2024, the first quarter of fiscal 2023, and fiscal 2023, respectively:


	Global Points of Access
	Quarter Ended		Fiscal Year Ended
	March 31, 2024	April 2, 2023	December 31, 2023
U.S.:
Hot Light Theater Shops	229	228	229
Fresh Shops	71	67	70
Cookie Bakeries	277	239	267

DFD Doors (2)	7,198	6,081	6,808
Total	7,775	6,615	7,374
International:
Hot Light Theater Shops	45	43	44
Fresh Shops	490	458	483
Carts, Food Trucks, and Other (1)	16	16	16
DFD Doors	4,202	3,319	3,977
Total	4,753	3,836	4,520
Market Development:
Hot Light Theater Shops	117	106	116
Fresh Shops	1,010	835	968

Carts, Food Trucks, and Other (1)	30	28	30
DFD Doors	1,129	990	1,139
Total	2,286	1,959	2,253
Total Global Points of Access (as defined)	14,814	12,410	14,147
Total Hot Light Theater Shops	391	377	389
Total Fresh Shops	1,571	1,360	1,521
Total Cookie Bakeries	277	239	267
Total Shops	2,239	1,976	2,177
Total Carts, Food Trucks, and Other	46	44	46
Total DFD Doors	12,529	10,390	11,924
Total Global Points of Access (as defined)	14,814	12,410	14,147

(1)Carts and Food Trucks are non-producing, mobile (typically on wheels) facilities without walls or a door where product is received from a Hot Light Theater Shop or Doughnut Factory. Other includes a vending machine. Points of Access in this category are primarily found in international locations in airports, train stations, etc.

(2)Includes over 160 McDonald’s shops located in Louisville and Lexington, Kentucky and the surrounding area as of March 31, 2024.

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As of March 31, 2024, we had 14,814 Global Points of Access, with 2,239 Krispy Kreme and Insomnia Cookies branded shops, 46 Carts and Food Trucks, and 12,529 DFD Doors. During the first quarter of fiscal 2024, we added a net 62 additional shops globally, including two Hot Light Theater Shops, 50 Fresh Shops, and 10 Insomnia Cookie Bakeries. Hot Light Theater Shop openings during the quarter included expansion in Philadelphia, Pennsylvania and Khamis Mushait, Saudi Arabia. We added a net 605 new DFD Doors during the quarter as we continue to focus on the deployment of our Hub and Spoke model and our expansion into QSR channels. We plan to continue adding new locations and expanding our digital platform in order to extend the availability of and access to our products. We are excited about our partnership with McDonald’s and the phasing of a U.S. national rollout, which we believe has validated the attractiveness of the QSR channel.

We also utilize “Hubs” as a key performance indicator. Our transformation is driven by the implementation of an omni-channel strategy to reach more consumers where they are and drive revenue growth, and this strategy is supported by a capital-efficient Hub and Spoke distribution model that provides a route to market and powers profitability. Our Hot Light Theater Shops and Doughnut Factories serve as centralized production facilities (“Hubs”). From these Hubs, we deliver doughnuts to our Fresh Shops, Carts and Food Trucks, and DFD Doors (“Spokes”) primarily through an integrated network of Company-operated delivery routes, ensuring quality and freshness. Specific to the U.S. segment, certain legacy Hubs have not historically had Spokes. Many Hubs in the U.S. segment are being converted to add Spokes while certain legacy Hubs do not currently have the ability or need to add Spokes.

The following table presents our Hubs, by segment and type, as of the end of the first quarter of fiscal 2024, the first quarter of fiscal 2023, and fiscal 2023, respectively:


	Hubs
	Quarter Ended		Fiscal Year Ended
	March 31, 2024	April 2, 2023	December 31, 2023
U.S.:
Hot Light Theater Shops (1)	221	221	220
Doughnut Factories	4	4	4
Total	225	225	224
Hubs with Spokes	154	137	149
Hubs without Spokes	71	88	75
International:
Hot Light Theater Shops (1)	36	34	36
Doughnut Factories	14	14	14
Total	50	48	50
Hubs with Spokes	50	48	50
Market Development:
Hot Light Theater Shops (1)	113	103	112
Doughnut Factories	26	24	23
Total	139	127	135
Total Hubs	414	400	409

(1)Includes only Hot Light Theater Shops and excludes Mini Theaters. A Mini Theater is a Spoke location that produces some doughnuts for itself and also receives doughnuts from another producing location.

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Non-GAAP Measures

We report our financial results in accordance with GAAP; however, management evaluates our results of operations using, among other measures, organic revenue growth, adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), and Adjusted Net Income, Diluted as we believe these non-GAAP measures are useful in evaluating our operating performance.

These non-GAAP financial measures are not universally consistent calculations, limiting their usefulness as comparative measures. Other companies may calculate similarly titled financial measures differently than we do or may not calculate them at all. Additionally, these non-GAAP financial measures are not measurements of financial performance under GAAP. In order to facilitate a clear understanding of our consolidated historical operating results, you should examine our non-GAAP financial measures in conjunction with our historical Condensed Consolidated Financial Statements and notes thereto included in this Quarterly Report on Form 10-Q.

Organic Revenue Growth

Organic revenue growth measures our revenue growth trends excluding the impact of acquisitions and foreign currency, and we believe it is useful for investors to understand the expansion of our global footprint through internal efforts. We define “organic revenue growth” as the growth in revenues, excluding (i) acquired shops owned by us for less than 12 months following their acquisition, (ii) the impact of foreign currency exchange rate changes, (iii) the impact of shop closures related to restructuring programs such as the shop portfolio optimization program initiated for Krispy Kreme U.S. during fiscal 2022, (iv) the impact of the Branded Sweat Treats business exit, and (v) revenues generated during the 53rd week for those fiscal years that have a 53rd week based on our fiscal calendar defined in Note 1, Description of Business and Summary of Significant Accounting Policies to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q. See “Results of Operations” for our organic growth calculations for the periods presented.

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Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS

We define “Adjusted EBITDA” as earnings before interest expense, net, income tax expense, and depreciation and amortization, with further adjustments for share-based compensation, certain strategic initiatives, acquisition and integration expenses, and other certain non-recurring, infrequent or non-core income and expense items. Adjusted EBITDA is a principal metric that management uses to monitor and evaluate operating performance and provides a consistent benchmark for comparison across reporting periods.

We define “Adjusted Net Income, Diluted” as net loss attributable to common shareholders, adjusted for interest expense, share-based compensation, certain strategic initiatives, acquisition and integration expenses, amortization of acquisition-related intangibles, the tax impact of adjustments, and other certain non-recurring, infrequent or non-core income and expense items. “Adjusted EPS” is Adjusted Net Income, Diluted converted to a per share amount.

Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS have certain limitations, including adjustments for income and expense items that are required by GAAP. In evaluating these non-GAAP measures, you should be aware that in the future we will incur expenses that are the same as or similar to some of the adjustments in this presentation, such as share-based compensation. Our presentation of Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS should not be construed to imply that our future results will be unaffected by any such adjustments. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA, Adjusted Net Income, Diluted, and Adjusted EPS supplementally.

The following tables present a reconciliation of net loss to Adjusted EBITDA and net loss to Adjusted Net Income, Diluted and Adjusted EPS for the periods presented:


	Quarter Ended
(in thousands)	March 31, 2024		April 2, 2023
Net (loss)/income	$	(6,663)	$	1,644
Interest expense, net	13,736		11,988

Income tax expense	4,262		317
Depreciation and amortization expense	33,586		27,939
Share-based compensation	6,986		5,545
Employer payroll taxes related to share-based compensation	43		25
Other non-operating expense, net (1)	573		999

Strategic initiatives (2)	4,821		13,469
Acquisition and integration expenses (3)	248		91
New market penetration expenses (4)	466		94
Shop closure expenses/(income), net (5)	139		(679)
Restructuring and severance expenses (6)	6		580

Gain on sale-leaseback	—		(9,661)
Other (7)	(15)		2,577
Adjusted EBITDA	$	58,188	$	54,928

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	Quarter Ended
(in thousands, except per share amounts)	March 31, 2024		April 2, 2023
Net (loss)/income	$	(6,663)	$	1,644

Share-based compensation	6,986		5,545
Employer payroll taxes related to share-based compensation	43		25
Other non-operating expense, net (1)	573		999

Strategic initiatives (2)	4,821		13,469
Acquisition and integration expenses (3)	248		91
New market penetration expenses (4)	466		94
Shop closure expenses/(income), net (5)	139		(679)
Restructuring and severance expenses (6)	6		580

Gain on sale-leaseback	—		(9,661)
Other (7)	(15)		2,577
Amortization of acquisition related intangibles (8)	7,420		7,273
Loss on extinguishment of 2019 Facility (9)	—		472
Tax impact of adjustments (10)	(224)		(4,656)
Tax specific adjustments (11)	(589)		(557)
Net income attributable to noncontrolling interest	(1,871)		(1,945)

Adjusted net income attributable to common shareholders - Basic	$	11,340	$	15,271
Additional income attributed to noncontrolling interest due to subsidiary potential common shares	(19)		(10)
Adjusted net income attributable to common shareholders - Diluted	$	11,321	$	15,261
Basic weighted average common shares outstanding	168,685		168,141
Dilutive effect of outstanding common stock options, RSUs, and PSUs	2,488		1,850
Diluted weighted average common shares outstanding	171,173		169,991
Adjusted net income per share attributable to common shareholders:
Basic	$	0.07	$	0.09
Diluted	$	0.07	$	0.09

(1)Primarily foreign translation gains and losses in each period.

(4)Consists of start-up costs associated with entry into new countries for which the Company’s brands have not previously operated, including the Insomnia Cookies brand entering Canada and the U.K.

(6)The quarter ended April 2, 2023 consists primarily of costs associated with restructuring of the global executive team.

(8)Consists of amortization related to acquired intangible assets as reflected within depreciation and amortization in the Condensed Consolidated Statements of Operations.

(9)Includes interest expenses related to unamortized debt issuance costs from the 2019 Facility associated with extinguished lenders as a result of the March 2023 debt refinancing.

(10)Tax impact of adjustments calculated applying the applicable statutory rates. The quarters ended March 31, 2024 and April 2, 2023 also include the impact of disallowed executive compensation expense.

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(11)The quarter ended March 31, 2024 consists of the recognition of a previously unrecognized tax benefit unrelated to ongoing operations and a discrete tax benefit unrelated to ongoing operations. The quarter ended April 2, 2023 consists of a discrete tax benefit unrelated to ongoing operations.

Sales Per Hub

In order to measure the effectiveness of our Hub and Spoke model, we use “Sales per Hub” on a trailing four-quarter basis, which includes all revenue generated from a Hub and its associated Spokes. Sales per Hub equals Fresh Revenues from Hubs with Spokes, divided by the average number of Hubs with Spokes during the period. Fresh Revenues include product sales generated from our Doughnut Shop business (including digital channels), as well as DFD sales, but excluding all Insomnia Cookies revenues as the measure is focused on the Krispy Kreme business. The Average Hub with Spokes for a period is calculated as the average of the number of Hubs with Spokes at the end of the five most recent quarters. The Sales per Hub performance measure allows us and investors to measure our effectiveness at leveraging the Hubs in the Hub and Spoke model to distribute product and generate cost efficiencies and profitability.

Sales per Hub was as follows for each of the periods below:


	Trailing Four Quarters Ended		Fiscal Year Ended
(in thousands, unless otherwise stated)	March 31, 2024		December 31, 2023		January 1, 2023
U.S.:
Revenues	$	1,119,535	$	1,104,944	$	1,010,250
Non-Fresh Revenues (1)	(4,003)		(9,416)		(38,380)
Fresh Revenues from Insomnia Cookies and Hubs without Spokes (2)	(395,102)		(399,061)		(404,430)
Sales from Hubs with Spokes	720,430		696,467		567,440
Sales per Hub (millions)	4.9		4.9		4.5

International:
Sales from Hubs with Spokes (3)	$	502,393	$	489,631	$	435,651
Sales per Hub (millions) (4)	10.2		10.0		9.7

(1)Includes the exited Branded Sweet Treats business revenues.

(2)Includes Insomnia Cookies revenues and Fresh Revenues generated by Hubs without Spokes.

(3)Total International net revenues is equal to Fresh Revenues from Hubs with Spokes for that business segment.

(4)International Sales per Hub comparative data has been restated in constant currency based on current exchange rates.

In our International segment, where the Hub and Spoke model originated, Sales per Hub reached $10.2 million, up from $10.0 million generated in the full fiscal year 2023, and up from $9.7 million generated in the full fiscal year 2022. The International segment illustrates the benefits of leveraging our Hub and Spoke model as the most efficient way to grow the business, as shown by the consistent Sales per Hub and higher Adjusted EBITDA margins despite elevated commodity costs and macroeconomic conditions. In the U.S. segment, we had Sales per Hub of $4.9 million, consistent with the $4.9 million generated in the full fiscal year 2023 and up from $4.5 million generated in the full fiscal year 2022. In the U.S. we continue our efforts to increase the number of DFD Doors served by our Hubs as the segment makes progress toward optimizing the model to look more like our International segment. As we further extend the Hub and Spoke model into existing and new markets around the world, we expect to see our Sales per Hub continue to grow.

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Results of Operations

The following comparisons are historical results and are not indicative of future results, which could differ materially from the historical financial information presented.

Quarter ended March 31, 2024 compared to the Quarter ended April 2, 2023

The following table presents our unaudited condensed consolidated results of operations for the quarter ended March 31, 2024 and the quarter ended April 2, 2023:


	Quarter Ended
	March 31, 2024				April 2, 2023				Change
(in thousands, except percentages)	Amount		% of Revenue		Amount		% of Revenue		$		%
Net revenues
Product sales	$	433,512	97.9	%	$	410,674	98.0	%	$	22,838	5.6	%
Royalties and other revenues	9,186		2.1	%	8,276		2.0	%	910		11.0	%
Total net revenues	442,698		100.0	%	418,950		100.0	%	23,748		5.7	%
Product and distribution costs	107,015		24.2	%	117,833		28.1	%	(10,818)		-9.2	%
Operating expenses	205,195		46.4	%	191,408		45.7	%	13,787		7.2	%
Selling, general and administrative expense	71,574		16.2	%	61,468		14.7	%	10,106		16.4	%
Marketing expenses	12,115		2.7	%	9,853		2.4	%	2,262		23.0	%
Pre-opening costs	1,105		0.2	%	764		0.2	%	341		44.6	%
Other expenses/(income), net	200		0.0	%	(5,263)		-1.3	%	5,463		103.8	%
Depreciation and amortization expense	33,586		7.6	%	27,939		6.7	%	5,647		20.2	%
Operating income	11,908		2.7	%	14,948		3.6	%	(3,040)		-20.3	%
Interest expense, net	13,736		3.1	%	11,988		2.9	%	1,748		14.6	%
Other non-operating expense, net	573		0.1	%	999		0.2	%	(426)		-42.6	%
(Loss)/income before income taxes	(2,401)		-0.5	%	1,961		0.5	%	(4,362)		-222.4	%
Income tax expense	4,262		1.0	%	317		0.1	%	3,945		1,244.5	%
Net (loss)/income	(6,663)		-1.5	%	1,644		0.4	%	(8,307)		-505.3	%
Net income attributable to noncontrolling interest	1,871		0.4	%	1,945		0.5	%	(74)		-3.8	%
Net loss attributable to Krispy Kreme, Inc.	$	(8,534)	-1.9	%	$	(301)	-0.1	%	$	(8,233)	-2,735.2	%

Royalties and other revenues: Royalties and other revenues increased $0.9 million, or 11.0%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024, led by expansion and performance of the international franchise business, partially offset by continued foreign exchange headwinds.

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The following table presents a further breakdown of total net revenue and organic revenue growth by segment for the quarter ended March 31, 2024 compared to the quarter ended April 2, 2023:


(in thousands, except percentages)	U.S.			International			Market Development			Total Company
Total net revenues in first quarter of fiscal 2024	$	295,935		$	124,750		$	22,013		$	442,698
Total net revenues in first quarter of fiscal 2023	281,344			111,988			25,618			418,950
Total Net Revenues Growth	14,591			12,762			(3,605)			23,748
Total Net Revenues Growth %	5.2		%	11.4		%	-14.1		%	5.7		%
Less: Impact of shop optimization program closures	(316)			—			—			(316)
Less: Impact of Branded Sweet Treats exit	(5,367)			—			—			(5,367)
Adjusted net revenues in first quarter of fiscal 2023	275,661			111,988			25,618			413,267
Adjusted net revenue growth	20,274			12,762			(3,605)			29,431


Impact of foreign currency translation	—			(1,836)			—			(1,836)
Organic Revenue Growth	$	20,274		$	10,926		$	(3,605)		$	27,595
Organic Revenue Growth %	7.4		%	9.8		%	-14.1		%	6.7		%

Total net revenue growth of $23.7 million, or approximately 5.7%, and organic revenue growth of $27.6 million, or approximately 6.7%, were driven by the continued and successful execution of our omni-channel growth strategy globally, high impact brand activations, and product premiumization efforts. We have continued to increase availability through new Global Points of Access, including capital-light DFD Doors, and via digital channels. Additionally, we have continued to take pricing actions to offset cost inflation, including in the first quarter of fiscal 2024, but with growth in pricing and cost inflation slowing compared to this time last year.

U.S. segment net revenue grew $14.6 million, or approximately 5.2%, and organic revenue increased $20.3 million, or approximately 7.4%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024. Growth was driven by an additional 1,160 Points of Access compared to the first quarter of fiscal 2023 and record-high digital channel sales due to a focus on owned channel improvements and increasing product availability through third parties. Organic revenue growth was also aided by effective pricing increases, leading to an increase in the average transaction size, offset some by transaction declines.

Our International segment net revenue grew $12.8 million, or approximately 11.4%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024, aided by foreign currency translation impacts of $1.8 million from a strengthening British pound and Mexican peso. International organic revenue grew $10.9 million, or approximately 9.8%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024, driven by increased pricing and Points of Access growth of 917 compared to the first quarter of fiscal 2023 and successful marketing activations. International organic revenue growth was offset some by softer transaction volume compared to last year.

Our Market Development segment net revenue and organic revenue decreased $3.6 million, or approximately 14.1%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024, driven by timing of mix and equipment sales to franchisees and softness in the Middle East markets.

Product and distribution costs (exclusive of depreciation and amortization): Product and distribution costs decreased $10.8 million, or 9.2%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024. As a percentage of revenue, product and distribution costs decreased by approximately 390 basis points from 28.1% in the first quarter of fiscal 2023 to 24.2% in the first quarter of fiscal 2024, primarily due to benefits from the exit of the lower-margin Branded Sweet Treats business as well as lapping the related $7.6 million inventory write-offs and employee severance expenses incurred during the first quarter of fiscal 2023.

Operating expenses: Operating expenses increased $13.8 million, or 7.2%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024, driven mainly by labor cost inflation and investments to support growth. Operating expenses as a percentage of revenue increased by approximately 70 basis points, from 45.7% in the first quarter of fiscal 2023 to 46.4% in the first quarter of fiscal 2024, primarily due to the impact of lower transaction volumes on operating leverage. This has been partially offset by efficiency benefits from Hub and Spoke expansion.

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Selling, general and administrative expense: Selling, general and administrative (“SG&A”) expense increased $10.1 million, or 16.4%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024. As a percentage of revenue, SG&A expense increased approximately 150 basis points, from 14.7% in the first quarter of fiscal 2023 to 16.2% in the first quarter of fiscal 2024, primarily driven by investments in strategic initiatives such as global transformation and exploring strategic alternatives for the Insomnia Cookies business, as well as higher share-based compensation expenses in the first quarter of fiscal 2024.

Other expenses/(income), net: Other income, net of $5.3 million in the first quarter of fiscal 2023 was primarily driven by a gain on a sale-leaseback transaction of $9.7 million, partially offset by $5.4 million of property, plant and equipment impairments associated with the decision to exit the Branded Sweet Treats business.

Depreciation and amortization expense: Depreciation and amortization expense increased $5.6 million, or 20.2%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024. As a percentage of revenue, depreciation and amortization expense increased approximately 90 basis points, from 6.7% in the first quarter of fiscal 2023 to 7.6% in the first quarter of fiscal 2024, primarily driven by higher capital spend and assets placed into service to support the Hub and Spoke model evolution, including preparing for the McDonald’s U.S. national rollout discussed in “Significant Events and Transactions” above.

Interest expense, net: Interest expense, net increased $1.7 million, or 14.6%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024. The increase was primarily driven by increases in outstanding debt and the benchmark interest rates associated with the unhedged portion of our variable rate long-term debt. The interest rate swap arrangements associated with the hedged portion of our long-term debt are set to mature in June 2024; we are currently evaluating arrangements to extend the maturity of these contracts.

Income tax expense: Income tax expense was $4.3 million in the first quarter of fiscal 2024, compared to $0.3 million in the first quarter of fiscal 2023. The increase of $3.9 million was primarily driven by lower pre-tax results and a decrease in the worldwide annual effective tax rate compared to the first quarter of fiscal 2023.

Results of Operations by Segment – Quarter ended March 31, 2024 compared to the Quarter ended April 2, 2023

The following table presents Adjusted EBITDA by segment for the periods indicated:


	Quarter Ended				Change
(in thousands, except percentages)	March 31, 2024		April 2, 2023		$		%
Adjusted EBITDA
U.S.	$	42,616	$	38,535	$	4,081	10.6	%
International	20,536		18,982		1,554		8.2	%
Market Development	11,900		11,551		349		3.0	%
Corporate	(16,864)		(14,140)		(2,724)		-19.3	%
Total Adjusted EBITDA (1)	$	58,188	$	54,928	$	3,260	5.9	%

(1) Refer to “Key Performance Indicators and Non-GAAP Measures” above for a reconciliation of Adjusted EBITDA to net income.

U.S. segment Adjusted EBITDA increased $4.1 million, or 10.6%, with margin expansion of 70 basis points to 14.4% in the first quarter of fiscal 2024 compared to the first quarter of fiscal 2023, driven by benefits from lapping the exited Branded Sweet Treats business, productivity benefits from Hub and Spoke expansion, the growth of digital channels, and labor and waste optimization. We also effectively offset commodity inflation and labor pressures by implementing pricing increases, including during the first quarter of fiscal 2024, but with growth in pricing slowing compared to this time last year.

International segment Adjusted EBITDA increased $1.6 million, or 8.2%, with margin decline of 50 basis points to 16.5% in the first quarter of fiscal 2024 compared to the first quarter of fiscal 2023, as lower transaction volumes in the U.K. continued to more than offset strength in the other International equity markets.

Market Development segment Adjusted EBITDA increased $0.3 million, or 3.0%, with margin expansion of 900 basis points to 54.1% in the first quarter of fiscal 2024 compared to the first quarter of fiscal 2023, driven mainly by the timing of lower-margin equipment sales and the continued expansion of our international franchise business.

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Corporate expenses within Adjusted EBITDA increased $2.7 million, or 19.3%, from the first quarter of fiscal 2023 to the first quarter of fiscal 2024 primarily due to strategic initiatives such as global transformation and exploring strategic opportunities for the Insomnia Cookies business.

Capital Resources and Liquidity

Our principal sources of liquidity to date have included cash from operating activities, cash on hand, amounts available under our credit facility, and vendor financing including our SCF programs and structured payables programs. Our primary use of liquidity is to fund the cash requirements of our business operations, including working capital needs, capital expenditures, acquisitions, and other commitments.

Our future obligations primarily consist of our debt and lease obligations, as well as commitments under ingredient and other forward purchase contracts. As of December 31, 2023, we had the following future obligations:

•An aggregate principal amount of $837.5 million outstanding under the 2023 Facility;

•An aggregate principal amount of $11.0 million outstanding under short-term, uncommitted lines of credit;

•Non-cancellable future minimum operating lease payments totaling $759.2 million;

•Non-cancellable future minimum finance lease payments totaling $63.3 million; and

•Purchase commitments under ingredient and other forward purchase contracts of $130.5 million.

As of March 31, 2024, our outstanding principal amount under our 2023 Facility was $881.3 million. The increase from the 2023 Facility balance as of December 31, 2023 included draws to fund payments on our commercial trade financing obligations. Refer to Note 8, Long-Term Debt to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for further information.

We had cash and cash equivalents of $33.1 million and $38.2 million as of March 31, 2024 and December 31, 2023, respectively. We believe that our existing cash and cash equivalents and debt facilities will be sufficient to fund our operating and capital needs for at least the next twelve months. Our assessment of the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement and involves risks and uncertainties. Our actual results could vary because of, and our future capital requirements will depend on, many factors, including our growth rate, the timing and extent of spending on business acquisitions, the growth of our presence in new markets, and the expansion of our omni-channel model in existing markets. We may enter into arrangements in the future to acquire or invest in complementary businesses, services, and technologies. We have based this estimate on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, or if we cannot expand our operations or otherwise capitalize on our business opportunities because we lack sufficient capital, our business, results of operations, and financial condition would be adversely affected.

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Cash Flows

We typically generate significant cash from operations and have substantial credit availability and capacity to fund operating and discretionary spending such as capital expenditures and debt repayments. Our requirement for working capital is not significant because our consumers pay us in cash or on debit or credit cards at the time of the sale and we are able to sell many of our inventory items before payment is due to the vendor of such items. The following table and discussion present, for the periods indicated, a summary of our key cash flows from operating, investing, and financing activities:


	Quarter Ended
(in thousands)	March 31, 2024		April 2, 2023
Net cash (used for)/provided by operating activities	$	(17,705)	$	10,365
Net cash used for investing activities	(29,045)		(16,446)
Net cash provided by financing activities	43,577		1,808

Cash Flows (Used For)/Provided by Operating Activities

Cash used for operations totaled $17.7 million for the first quarter of fiscal 2024, a fluctuation of $28.1 million compared with the first quarter of fiscal 2023. This fluctuation in cash flows related to operations was primarily due to the intentional paydown of obligations due under our SCF programs discussed in Note 7, Vendor Finance Programs to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, as well as our receipt of $7.7 million cash proceeds from the settlement of interest rate swap derivative contracts in the first quarter of fiscal 2023 discussed in Note 6, Derivative Instruments to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q.

Cash Flows Used for Investing Activities

Cash used for investing activities totaled $29.0 million for the first quarter of fiscal 2024, an increase of $12.6 million compared with the first quarter of fiscal 2023. The increase was primarily due to $10.0 million proceeds from a sale-leaseback transaction during the first quarter of fiscal 2023 discussed in Note 4, Leases to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, as well as higher capital expenditures in the first quarter of fiscal 2024.

We expect to incur additional capital expenditures related to our accelerated U.S. expansion, including via QSR channels such as the McDonald’s U.S. national rollout discussed in “Significant Events and Transactions” above. We continue to expect capital expenditures to be between 7% and 8% of revenues in fiscal 2024 as we continue to deploy the capital-efficient Hub and Spoke model globally. We expect incremental cash outflows related to capital expenditures associated with the accelerated U.S. expansion primarily in 2025 and 2026, which would have an impact on our capital expenditures as a percentage of revenues during those years.

Cash Flows Provided by Financing Activities

Cash provided by financing activities totaled $43.6 million for the first quarter of fiscal 2024, an increase of $41.8 million compared with the first quarter of fiscal 2023. The increase was primarily due to draws on our 2023 Facility used in part to fund payments to reduce our vendor finance program obligations, particularly the SCF programs.

Payments on our structured payables resulted in a net $29.6 million change in cash flows (net proceeds from structured payables of $3.9 million in the first quarter of fiscal 2024 compared to net payments on structured payables of $25.7 million in the first quarter of fiscal 2023). Refer to Note 7, Vendor Finance Programs to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for further information.

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Debt

Our long-term debt obligations consist of the following:


(in thousands)	March 31, 2024		December 31, 2023
2023 Facility — term loan	$	673,750	$	682,500
2023 Facility — revolving credit facility	207,500		155,000
Short-term lines of credit	17,000		11,000


Less: Debt issuance costs	(4,109)		(4,371)
Finance lease obligations	47,963		47,117
Total long-term debt	942,104		891,246
Less: Current portion of long-term debt	(60,326)		(54,631)
Long-term debt, less current portion	$	881,778	$	836,615

2023 Secured Credit Facility

The 2023 Facility consist of a $300.0 million senior secured revolving credit facility and a term loan with a principal amount of $700.0 million. Refer to Note 8, Long-Term Debt to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for further information.

Under the terms of the 2023 Facility, we are subject to a requirement to maintain a leverage ratio of less than 5.00 to 1.00 as of the end of each quarterly Test Period (as defined in the 2023 Facility) through maturity in March 2028. The leverage ratio under the 2023 Facility is defined as the ratio of (a) Total Indebtedness (as defined in the 2023 Facility, which includes all debt and finance lease obligations) minus unrestricted cash and cash equivalents to (b) a defined calculation of Adjusted EBITDA (2023 Facility Adjusted EBITDA) for the most recently ended Test Period. Our leverage ratio was 3.75 to 1.00 as of the end of the first quarter of fiscal 2024 compared to 3.48 to 1.00 as of the end of fiscal 2023, primarily due to the increase in long-term debt.

We were in compliance with the financial covenants related to the 2023 Facility as of March 31, 2024 and expect to remain in compliance over the next 12 months. If we are unable to meet the 2023 Facility financial or other covenants in future periods, it may negatively impact our liquidity by limiting our ability to draw on the revolving credit facility, could result in the lenders accelerating the maturity of such indebtedness and foreclosing upon the collateral pledged thereunder, and could require the replacement of the 2023 Facility with new sources of financing, which there is no guaranty we could secure.

Short-Term Lines of Credit

We are party to two agreements with existing lenders providing for short-term, uncommitted lines of credit up to $25.0 million. Borrowings under these short-term lines of credit are payable to the lenders on a revolving basis for tenors up to a maximum of three months and are subject to an interest rate of adjusted term SOFR plus a credit spread adjustment of 0.10% plus a margin of 1.75%.

Critical Accounting Policies and Estimates

Our Condensed Consolidated Financial Statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q have been prepared in conformity with GAAP. The preparation of the Condensed Consolidated Financial Statements requires the use of judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses as well as related disclosures. We consider an accounting judgment, estimate, or assumption to be critical when (1) the estimate or assumption is complex in nature or requires a high degree of judgment and (2) the use of different judgments, estimates, and assumptions could have a material impact on our Condensed Consolidated Financial Statements. Actual results could differ from the estimates made by management.

There have been no material changes to our critical accounting policies and estimates as compared to those described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” set forth in our Annual Report on Form 10-K for the year ended December 31, 2023.

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New Accounting Pronouncements

Refer to Note 1, Description of Business and Summary of Significant Accounting Policies to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, for a detailed description of recent accounting pronouncements.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Effects of Changing Prices – Inflation

We are exposed to the effects of commodity price fluctuations in the cost of ingredients of our products, of which flour, sugar, and shortening are the most significant. During the first quarter of fiscal 2024, we have continued to experience headwinds from commodity inflation globally. We have undertaken efforts to effectively manage inflationary cost increases through rapid inventory turnover and reduced inventory waste, increased focus on resiliency of our supply chains, and an ability to adjust pricing of our products. Additionally, from time to time we may enter into forward contracts for supply through our vendors for raw materials which are ingredients of our products or which are components of such ingredients, including wheat, sugar, and soybean oil.

We are also exposed to the effects of commodity price fluctuations in the cost of gasoline used by our delivery vehicles. To mitigate the risk of fluctuations in the price of our fuel purchases, we may directly purchase commodity futures contracts.

Interest Rate Risk

We are exposed to changes in interest rates on any borrowings under our debt facilities, which bear interest based on the one-month SOFR (with a floor of zero). Generally, interest rate changes could impact the amount of our interest paid and, therefore, our future earnings and cash flows, assuming other factors are held constant. To mitigate the impact of changes in SOFR on interest expense for a portion of our variable rate debt, we have entered into interest rate swaps on $505.0 million notional of our $898.3 million of outstanding debt under the 2023 Facility and short-term lines of credit as of March 31, 2024, which we account for as cash flow hedges. The interest rate swap agreements are scheduled to mature in June 2024. Based on the $393.3 million of unhedged outstanding as of March 31, 2024, a 100 basis point increase or decrease in the one-month SOFR would result in a $3.9 million increase or decrease, respectively, in interest expense for a 12-month period, based on the daily average of the one-month SOFR for the quarter ended March 31, 2024.

Foreign Currency Risk

We are exposed to foreign currency translation risk on the operations of our subsidiaries that have functional currencies other than the U.S. dollar, whose revenues accounted for approximately 28% of our total net revenues through the quarter ended March 31, 2024. A substantial majority of these revenues, or approximately $124.8 million through the quarter ended March 31, 2024, were attributable to subsidiaries whose functional currencies are the Canadian dollar, the British pound sterling, the Euro, the Australian dollar, the New Zealand dollar, the Mexican peso, and the Japanese yen. A 10% increase or decrease in the average exchange rate of the Canadian dollar, the British pound sterling, the Euro, the Australian dollar, the New Zealand dollar, the Mexican peso, and the Japanese yen against the U.S. dollar would have resulted in a decrease or increase of approximately $12.5 million in our total net revenues for the quarter ended March 31, 2024.

From time to time, we engage in foreign currency exchange and credit transactions with our non-U.S. subsidiaries, which we typically hedge. To date, the impact of such transactions, including the cost of hedging, has not been material. We do not engage in foreign currency or hedging transactions for speculative purposes.

Item 4. Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in Exchange Act reports 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 our management, including our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate, to allow timely decisions regarding required disclosure.

As of March 31, 2024, we completed an evaluation, under the supervision and with the participation of our management, including our CEO and CFO, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our CEO and CFO concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q.

There were no changes during the fiscal quarter ended March 31, 2024 in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

In the ordinary course of conducting our business, we have in the past and may in the future become involved in various legal actions and other claims. We may also become involved in other judicial, regulatory, and arbitration proceedings concerning matters arising in connection with the conduct of our businesses. Some of these matters may involve claims of substantial amounts. These legal proceedings may be subject to many uncertainties and there can be no assurance of the outcome of any individual proceedings. See Note 11, Commitments and Contingencies, to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for information regarding certain legal proceedings in which we are involved.

Item 1A. Risk Factors

There have been no material changes to the risk factors previously disclosed in “Risk Factors” in Part 1, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

During the quarter ended March 31, 2024, no director nor Section 16 officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or any “non-Rule 10b5-1 arrangements” (in each case, as defined in Item 408(a) of Regulation S-K).

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Item 6. Exhibits


Exhibit No.						Description of Exhibit

10.1						Transition and Separation Agreement, dated March 13, 2024, between Krispy Kreme, Inc., Krispy Kreme Doughnut Corporation, and Catherine Tang (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K, File number 001-40573, on March 14, 2024).

31.1*						Certification of Chief Executive Officer of Krispy Kreme, Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act.

31.2*						Certification of Chief Financial Officer of Krispy Kreme, Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act.

32.1**						Certifications of Chief Executive Officer and Chief Financial Officer of Krispy Kreme, Inc. pursuant to Rule 13a-14(b) or 15d-14(b) promulgated under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code.

101						The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Statements of Comprehensive Income/(Loss), (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Changes in Shareholders’ Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to Condensed Consolidated Financial Statements.

104						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).



*			Filed herewith.
**			Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Charlotte, North Carolina on May 9, 2024.


Krispy Kreme, Inc.

By:			/s/ Jeremiah Ashukian
Name:			Jeremiah Ashukian
Title:			Chief Financial Officer

Exhibit 31.1

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Josh Charlesworth, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024, of Krispy Kreme, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2024

/s/ Josh Charlesworth

Josh Charlesworth

Chief Executive Officer

Exhibit 31.2

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Jeremiah Ashukian, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024, of Krispy Kreme, Inc.;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2024

/s/ Jeremiah Ashukian

Jeremiah Ashukian

Chief Financial Officer

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Krispy Kreme, Inc. (the “Company”), for the quarterly period ended March 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 9, 2024

/s/ Josh Charlesworth

Josh Charlesworth

Chief Executive Officer

Date: May 9, 2024

/s/ Jeremiah Ashukian

Jeremiah Ashukian

Chief Financial Officer

Cover Page - shares	3 Months Ended
Cover Page - shares	Mar. 31, 2024	Apr. 30, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-40573
Entity Registrant Name	Krispy Kreme, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	37-1701311
Entity Address, Address Line One	2116 Hawkins Street
Entity Address, City or Town	Charlotte
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	28203
City Area Code	800
Local Phone Number	457-4779
Title of 12(b) Security	Common stock, $0.01 par value per share
Entity Trading Symbol	DNUT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		168,700,000
Entity Central Index Key	0001857154
Current Fiscal Year End Date	--12-29
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Total net revenues	$ 442,698	$ 418,950
Product and distribution costs	107,015	117,833
Operating expenses	205,195	191,408
Selling, general and administrative expense	71,574	61,468
Marketing expenses	12,115	9,853
Pre-opening costs	1,105	764
Other expenses/(income), net	200	(5,263)
Depreciation and amortization expense	33,586	27,939
Operating income	11,908	14,948
Interest expense, net	13,736	11,988
Other non-operating expense, net	573	999
(Loss)/income before income taxes	(2,401)	1,961
Income tax expense	4,262	317
Net (loss)/income	(6,663)	1,644
Net income attributable to noncontrolling interest	1,871	1,945
Net loss attributable to Krispy Kreme, Inc.	$ (8,534)	$ (301)
Net loss per share:
Common stock — Basic (in dollars per share)	$ (0.05)	$ (0.00)
Common stock — Diluted (in dollars per share)	$ (0.05)	$ (0.00)
Weighted average shares outstanding:
Basic (in shares)	168,685	168,141
Diluted (in shares)	168,685	168,141
Product sales
Total net revenues	$ 433,512	$ 410,674
Royalties and other revenues
Total net revenues	$ 9,186	$ 8,276

Condensed Consolidated Statements of Comprehensive Income/(Loss) (Unaudited) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2024

Apr. 02, 2023

Statement of Comprehensive Income [Abstract]

Net (loss)/income

$ (6,663)

$ 1,644

Other comprehensive (loss)/income, net of income taxes:

Foreign currency translation adjustment

(6,069)

11,092

Unrealized loss on cash flow hedges, net of income taxes (1)

^[1]

(2,684)

(2,967)

Total other comprehensive (loss)/income

(8,753)

8,125

Comprehensive (loss)/income

(15,416)

9,769

Net income attributable to noncontrolling interest

1,871

1,945

Foreign currency translation adjustment attributable to noncontrolling interest

(299)

(108)

Total comprehensive income attributable to noncontrolling interest

1,572

1,837

Comprehensive (loss)/income attributable to Krispy Kreme, Inc.

$ (16,988)

$ 7,932

[1]	Net of income tax benefit of $0.9 million and $1.0 million for the quarters ended March 31, 2024, and April 2, 2023, respectively.

Condensed Consolidated Statements of Comprehensive Income/(Loss) (Unaudited) (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Statement of Comprehensive Income [Abstract]
Unrealized income on cash flow hedges, tax expense (benefit)	$ 0.9	$ 1.0

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 33,132	$ 38,185
Restricted cash	480	429
Accounts receivable, net	57,287	59,362
Inventories	39,257	34,716
Taxes receivable	18,397	15,526
Prepaid expense and other current assets	25,461	25,363
Total current assets	174,014	173,581
Property and equipment, net	543,100	538,220
Goodwill	1,098,826	1,101,939
Other intangible assets, net	938,847	946,349
Operating lease right of use asset, net	456,810	456,964
Other assets	22,721	23,539
Total assets	3,234,318	3,240,592
Current liabilities:
Current portion of long-term debt	60,326	54,631
Current operating lease liabilities	50,275	50,365
Accounts payable	128,555	156,488
Accrued liabilities	117,093	134,005
Structured payables	133,809	130,104
Total current liabilities	490,058	525,593
Long-term debt, less current portion	881,778	836,615
Noncurrent operating lease liabilities	454,265	454,583
Deferred income taxes, net	123,203	123,925
Other long-term obligations and deferred credits	37,127	36,093
Total liabilities	1,986,431	1,976,809
Commitments and contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 300,000 shares authorized as of both March 31, 2024 and December 31, 2023; 168,731 and 168,628 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively	1,687	1,686
Additional paid-in capital	1,449,773	1,443,591
Shareholder note receivable	(3,629)	(3,850)
Accumulated other comprehensive (loss)/income, net of income tax	(1,208)	7,246
Retained deficit	(293,430)	(278,990)
Total shareholders’ equity attributable to Krispy Kreme, Inc.	1,153,193	1,169,683
Noncontrolling interest	94,694	94,100
Total shareholders’ equity	1,247,887	1,263,783
Total liabilities and shareholders’ equity	$ 3,234,318	$ 3,240,592

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	300,000	300,000
Common stock, shares issued (in shares)	168,731	168,628
Common stock, shares outstanding (in shares)	168,731	168,628

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited) - USD ($)
shares in Thousands, $ in Thousands

Total

Common Stock

Additional Paid-in Capital

Shareholder Note Receivable

Foreign Currency Translation Adjustment

Unrealized (Loss)/Income on Cash Flow Hedges

Unrealized Loss on Employee Benefit Plans

Retained (Deficit)/Earnings

Noncontrolling Interest

Beginning balance (in shares) at Jan. 01, 2023

168,137

Beginning balance at Jan. 01, 2023

$ 1,298,875

$ 1,681

$ 1,426,105

$ (4,813)

$ (23,028)

$ 14,251

$ (374)

$ (217,490)

$ 102,543

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Net (loss) income

1,644

(301)

1,945

Other comprehensive income/(loss), before reclassifications

10,311

11,200

(781)

(108)

Reclassification from AOCI

(2,186)

Share-based compensation

5,545

Dividends declared on common stock and equivalents

(5,884)

Distribution to noncontrolling interest

(1,139)

Issuance of common stock upon settlement of RSUs, net of shares withheld (in shares)

Issuance of common stock upon settlement of RSUs, net of shares withheld

$ 1

(1)

Other

(16)

(17)

Ending balance (in shares) at Apr. 02, 2023

168,176

Ending balance at Apr. 02, 2023

$ 1,307,150

$ 1,682

1,431,649

(4,830)

(11,828)

11,284

(374)

(223,674)

103,241

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Dividends declared on common stock and equivalents (in dollars per share)

$ 0.035

Beginning balance (in shares) at Dec. 31, 2023

168,628

Beginning balance at Dec. 31, 2023

$ 1,263,783

$ 1,686

1,443,591

(3,850)

1,985

5,629

(368)

(278,990)

94,100

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Net (loss) income

(6,663)

(8,534)

1,871

Other comprehensive income/(loss), before reclassifications

(5,702)

(5,770)

367

(299)

Reclassification from AOCI

(3,051)

Capital contribution from shareholders, net of loans issued

232

Share-based compensation

6,986

Dividends declared on common stock and equivalents

^[1]

(5,905)

Distribution to noncontrolling interest

(977)

Issuance of common stock upon settlement of RSUs, net of shares withheld (in shares)

103

Issuance of common stock upon settlement of RSUs, net of shares withheld

(804)

$ 1

(805)

Other

$ (12)

(11)

(1)

Ending balance (in shares) at Mar. 31, 2024

168,731

Ending balance at Mar. 31, 2024

$ 1,247,887

$ 1,687

$ 1,449,773

$ (3,629)

$ (3,785)

$ 2,945

$ (368)

$ (293,430)

$ 94,694

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Dividends declared on common stock and equivalents (in dollars per share)

$ 0.035

[1]	Includes a $0.035 cash dividend per common share declared in the first quarter of fiscal 2024 and expected to be paid in the second quarter of fiscal 2024.

Condensed Consolidated Statements of Changes in Shareholders’ Equity (Parenthetical) (Unaudited) - $ / shares	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Statement of Stockholders' Equity [Abstract]
Dividends declared on common stock and equivalents (in dollars per share)	$ 0.035	$ 0.035

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
CASH FLOWS (USED FOR)/FROM OPERATING ACTIVITIES:
Net (loss)/income	$ (6,663)	$ 1,644
Adjustments to reconcile net (loss)/income to net cash (used for)/provided by operating activities:
Depreciation and amortization expense	33,586	27,939
Deferred and other income taxes	214	(219)
Loss on extinguishment of debt	0	472
Impairment and lease termination charges	247	4,900
(Gain)/loss on disposal of property and equipment	(49)	33
Gain on sale-leaseback	0	(9,661)
Share-based compensation	6,986	5,545
Change in accounts and notes receivable allowances	113	334
Inventory write-off	411	7,115
Settlement of interest rate swap derivatives	0	7,657
Amortization related to settlement of interest rate swap derivatives	(2,955)	0
Other	788	(204)
Change in operating assets and liabilities, excluding foreign currency translation adjustments	(50,383)	(35,190)
Net cash (used for)/provided by operating activities	(17,705)	10,365
CASH FLOWS USED FOR INVESTING ACTIVITIES:
Purchase of property and equipment	(29,064)	(26,553)
Proceeds from sale-leaseback	0	10,025
Other investing activities	19	82
Net cash used for investing activities	(29,045)	(16,446)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from the issuance of debt	179,500	891,698
Repayment of long-term debt and lease obligations	(132,343)	(852,144)
Payment of financing costs	0	(5,000)
Proceeds from structured payables	101,287	44,757
Payments on structured payables	(97,416)	(70,480)
Capital contribution by shareholders, net of loans issued	232	0
Distribution to shareholders	(5,902)	(5,884)
Payments for repurchase and retirement of common stock	(804)	0
Distribution to noncontrolling interest	(977)	(1,139)
Net cash provided by financing activities	43,577	1,808
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1,829)	(1,373)
Net decrease in cash, cash equivalents and restricted cash	(5,002)	(5,646)
Cash, cash equivalents and restricted cash at beginning of period	38,614	35,730
Cash, cash equivalents and restricted cash at end of period	33,612	30,084
Supplemental schedule of non-cash investing and financing activities:
Increase/(decrease) in accrual for property and equipment	3,913	(104)
Accrual for distribution to shareholders	(5,905)	(5,884)
Reconciliation of cash, cash equivalents and restricted cash at end of period:
Cash and cash equivalents	33,132	29,675
Restricted cash	480	409
Total cash, cash equivalents and restricted cash	$ 33,612	$ 30,084

Description of Business and Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Summary of Significant Accounting Policies	Description of Business and Summary of Significant Accounting Policies Description of Business Krispy Kreme, Inc. (“KKI”) and its subsidiaries (collectively, the “Company” or “Krispy Kreme”) operates through its omni-channel business model to deliver fresh doughnut experiences and produce doughnuts for Doughnut Shops, Delivered Fresh Daily (“DFD”) outlets, and digital channels, expanding consumer access to the Krispy Kreme brand. The Company has three reportable operating segments: 1) U.S., which includes all Krispy Kreme Company-owned operations in the U.S. and Insomnia Cookies Bakeries globally; 2) International, which includes all Krispy Kreme Company-owned operations in the U.K., Ireland, Australia, New Zealand, Mexico, Canada, and Japan; and 3) Market Development, which includes franchise operations across the globe. Unallocated corporate costs are excluded from the Company’s measurement of segment performance. Basis of Presentation and Consolidation The Company operates and reports financial information on a 52 or 53-week year with the fiscal year ending on the Sunday closest to December 31. The data periods contained within fiscal years 2023 and 2024 will reflect the results of operations for the 52-week periods ended December 31, 2023 and December 29, 2024, respectively. The quarters ended March 31, 2024 and April 2, 2023 were both 13-week periods. The unaudited Condensed Consolidated Financial Statements include the accounts of KKI and subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, these interim financial statements do not include all information and footnotes required under GAAP for complete financial statements. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of results of operations, balance sheet, cash flows, and shareholders’ equity for the periods presented. All significant intercompany balances and transactions among KKI and subsidiaries have been eliminated in consolidation. Investments in entities over which the Company has the ability to exercise significant influence but which it does not control and whose financial statements are not otherwise required to be consolidated, are accounted for using the equity method. These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto as of and for the year ended December 31, 2023, included in the Annual Report on Form 10-K. The Condensed Consolidated Balance Sheet as of December 31, 2023 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The results of operations for the quarter ended March 31, 2024 are not necessarily indicative of the results of operations that may be achieved for the entire fiscal year ending December 29, 2024. Noncontrolling interest in the Company’s Condensed Consolidated Financial Statements represents the interest in subsidiaries held by joint venture partners and employee shareholders. The joint venture partners hold noncontrolling interests in the Company’s consolidated subsidiaries, Awesome Doughnut, LLC (“Awesome Doughnut”), W.K.S. Krispy Kreme, LLC (“WKS Krispy Kreme”), and Krispy K Canada, Inc. (“KK Canada”). Employee shareholders hold noncontrolling interests in the consolidated subsidiaries Krispy Kreme Holding U.K. Ltd. (“KK U.K.”), Krispy Kreme Holdings Pty Ltd. (“KK Australia”), Krispy Kreme Mexico Holding S.A.P.I. de C.V. (“KK Mexico”), and Insomnia Cookies Holdings, LLC (“Insomnia Cookies”). Since the Company consolidates the financial statements of these subsidiaries, the noncontrolling owners’ share of each subsidiary’s net assets and results of operations are deducted and reported as noncontrolling interest on the Condensed Consolidated Balance Sheets and as net income attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations and comprehensive income attributable to noncontrolling interest in the Condensed Consolidated Statements of Comprehensive (Loss)/Income. Summary of Significant Accounting Policies The Company’s significant accounting policies are described in Note 1, “Description of Business and Summary of Significant Accounting Policies” to the Consolidated Financial Statements for the year ended December 31, 2023 included in the Annual Report on Form 10-K. There have been no material changes to the significant accounting policies during the quarter ended March 31, 2024. Reclassifications Segment information is prepared on the same basis that the Company’s management reviews financial information for operational decision-making purposes. Effective January 1, 2024, the Company realigned its segment reporting structure such that the Company-owned Canada and Japan businesses have moved from the Market Development reportable operating segment to the International reportable operating segment. All segment information has been restated to be consistent with current presentation. Recent Accounting Pronouncements

Inventories

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Inventories

The components of Inventories are as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	23,594	$	21,000
Work in progress	470		211
Finished goods and purchased merchandise	15,193		13,505
Total inventories	$	39,257	$	34,716

Goodwill and Other Intangible Assets, net

3 Months Ended

Mar. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets, net

Goodwill

Changes in the carrying amount of goodwill by reportable segment are as follows:


	U.S.		International		Market Development		Total
Balance as of December 31, 2023	$	677,956	$	294,468	$	129,515	$	1,101,939


Foreign currency impact	—		(3,113)		—		(3,113)
Balance as of March 31, 2024	$	677,956	$	291,355	$	129,515	$	1,098,826

Other Intangible Assets, net

Other intangible assets consist of the following:


	March 31, 2024						December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Amount		Gross Carrying Amount		Accumulated Amortization		Net Amount
Intangible assets with indefinite lives
Trade names and trademarks	$	657,990	$	—	$	657,990	$	657,980	$	—	$	657,980
Intangible assets with definite lives
Franchise agreements	30,390		(11,107)		19,283		30,390		(10,744)		19,646
Customer relationships	15,000		(6,629)		8,371		15,000		(6,413)		8,587
Reacquired franchise rights (1)	396,822		(143,619)		253,203		397,279		(137,143)		260,136

Total intangible assets with definite lives	442,212		(161,355)		280,857		442,669		(154,300)		288,369
Total intangible assets	$	1,100,202	$	(161,355)	$	938,847	$	1,100,649	$	(154,300)	$	946,349

(1)Reacquired franchise rights include the impact of foreign currency fluctuations associated with the respective countries.

Leases

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Leases

The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:


		As of
		March 31, 2024		December 31, 2023
Assets	Classification
Operating lease	Operating lease right of use asset, net	$	456,810	$	456,964
Finance lease	Property and equipment, net	42,140		41,411
Total leased assets		$	498,950	$	498,375
Liabilities
Current
Operating lease	Current operating lease liabilities	$	50,275	$	50,365
Finance lease	Current portion of long-term debt	8,326		8,631
Noncurrent
Operating lease	Noncurrent operating lease liabilities	454,265		454,583
Finance lease	Long-term debt, less current portion	39,637		38,486
Total leased liabilities		$	552,503	$	552,065

Lease costs were as follows:


		Quarter Ended
		March 31, 2024		April 2, 2023
Lease cost	Classification
Operating lease cost	Selling, general and administrative expense	$	935	$	891
Operating lease cost	Operating expenses	24,023		22,390
Short-term lease cost	Operating expenses	1,085		1,281
Variable lease costs	Operating expenses	7,433		9,345
Sublease income	Royalties and other revenues	(35)		(35)
Finance lease cost:
Amortization of right of use assets	Depreciation and amortization expense	$	2,921	$	1,584
Interest on lease liabilities	Interest expense, net	877		573

Supplemental disclosures of cash flow information related to leases were as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)	$	31,124	$	29,145
Operating cash flows for finance leases	864		549
Financing cash flows for finance leases	2,593		1,696
Right of use assets obtained in exchange for new lease liabilities:
Operating leases	$	13,114	$	26,850
Finance leases	3,158		1,421

Leases

The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:


		As of
		March 31, 2024		December 31, 2023
Assets	Classification
Operating lease	Operating lease right of use asset, net	$	456,810	$	456,964
Finance lease	Property and equipment, net	42,140		41,411
Total leased assets		$	498,950	$	498,375
Liabilities
Current
Operating lease	Current operating lease liabilities	$	50,275	$	50,365
Finance lease	Current portion of long-term debt	8,326		8,631
Noncurrent
Operating lease	Noncurrent operating lease liabilities	454,265		454,583
Finance lease	Long-term debt, less current portion	39,637		38,486
Total leased liabilities		$	552,503	$	552,065

Lease costs were as follows:


		Quarter Ended
		March 31, 2024		April 2, 2023
Lease cost	Classification
Operating lease cost	Selling, general and administrative expense	$	935	$	891
Operating lease cost	Operating expenses	24,023		22,390
Short-term lease cost	Operating expenses	1,085		1,281
Variable lease costs	Operating expenses	7,433		9,345
Sublease income	Royalties and other revenues	(35)		(35)
Finance lease cost:
Amortization of right of use assets	Depreciation and amortization expense	$	2,921	$	1,584
Interest on lease liabilities	Interest expense, net	877		573

Supplemental disclosures of cash flow information related to leases were as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)	$	31,124	$	29,145
Operating cash flows for finance leases	864		549
Financing cash flows for finance leases	2,593		1,696
Right of use assets obtained in exchange for new lease liabilities:
Operating leases	$	13,114	$	26,850
Finance leases	3,158		1,421

Fair Value Measurements

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:


	March 31, 2024
		Level 2
Assets:

Interest rate derivatives		$	972
Commodity derivatives		341

Total Assets		$	1,313

Liabilities:
Foreign currency derivatives		$	599
Total Liabilities		$	599


	December 31, 2023
		Level 2
Assets:

Interest rate derivatives		$	1,596

Total Assets		$	1,596

Liabilities:
Foreign currency derivatives		$	345
Commodity derivatives		113
Total Liabilities		$	458

Derivative Instruments

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Commodity Price Risk

Interest Rate Risk

Foreign Currency Exchange Rate Risk

Quantitative Summary of Derivative Positions and Their Effect on Results of Operations


	Derivatives Fair Value
Derivatives Not Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location

Commodity derivatives	$	341	$	—	Prepaid expense and other current assets
Total Assets	$	341	$	—
Foreign currency derivatives	$	599	$	345	Accrued liabilities
Commodity derivatives	—		113		Accrued liabilities
Total Liabilities	$	599	$	458


	Derivatives Fair Value
Derivatives Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location
Interest rate derivatives	$	972	$	1,596	Prepaid expense and other current assets

Total Assets	$	972	$	1,596

The effect of derivative instruments on the Condensed Consolidated Statements of Operations for the quarters ended March 31, 2024 and April 2, 2023 is as follows:


	Derivative Gain Recognized in Income for the Quarter Ended
Derivatives Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative Gain Recognized in Income
Gain on interest rate derivatives	$	3,051	$	2,186	Interest expense, net
	$	3,051	$	2,186


	Derivative (Loss)/Gain Recognized in Income for the Quarter Ended
Derivatives Not Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative (Loss)/Gain Recognized in Income
Loss on foreign currency derivatives	$	(254)	$	(924)	Other non-operating expense, net
Gain/(loss) on commodity derivatives	454		(118)		Other non-operating expense, net
	$	200	$	(1,042)

Vendor Finance Programs

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Vendor Finance Programs

The following table presents liabilities related to vendor finance programs which the Company participates in as a buyer as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Supply chain financing programs	$	29,622	$	51,239	Accounts payable
Structured payables programs	133,809		130,104		Structured payables
Total Liabilities	$	163,431	$	181,343

Supply Chain Financing (“SCF”) Programs

Structured Payables Programs

Long-Term Debt

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Long-Term Debt

The Company’s long-term debt obligations consists of the following:


	March 31, 2024		December 31, 2023
2023 Facility — term loan	$	673,750	$	682,500
2023 Facility — revolving credit facility	207,500		155,000
Short-term lines of credit	17,000		11,000


Less: Debt issuance costs	(4,109)		(4,371)
Finance lease obligations	47,963		47,117
Total long-term debt	942,104		891,246
Less: Current portion of long-term debt	(60,326)		(54,631)
Long-term debt, less current portion	$	881,778	$	836,615

2023 Secured Credit Facility

Short-Term Lines of Credit

Share-based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Share-based Compensation

Restricted Stock Units (“RSUs”) and Performance Stock Units (“PSUs”)

The Company and certain of its subsidiaries issue time-vested RSUs and PSUs under their respective executive ownership plans and long-term incentive plans.

RSU and PSU activity under the Company’s various plans during the periods presented is as follows:


(in thousands, except per share amounts)	Non-vested shares outstanding at December 31, 2023		Granted	Vested	Forfeited	Non-vested shares outstanding at March 31, 2024
KKI
RSUs and PSUs	6,785		104	164	88	6,637
Weighted Average Grant Date Fair Value	$	14.54	13.52	14.75	15.11	$	14.51
KK U.K.
RSUs	7		—	—	—	7
Weighted Average Grant Date Fair Value	$	29.80	—	—	—	$	29.80
Insomnia Cookies
RSUs	47		—	2	—	45
Weighted Average Grant Date Fair Value	$	120.21	—	74.12	—	$	122.42
KK Australia
RSUs	185		—	—	—	185
Weighted Average Grant Date Fair Value	$	1.57	—	—	—	$	1.57
KK Mexico
RSUs	20		—	—	—	20
Weighted Average Grant Date Fair Value	$	30.18	—	—	—	$	30.18

The unrecognized compensation cost related to the unvested RSUs and PSUs and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	53,665	2.9 years
KK U.K.	94		2.2 years
Insomnia Cookies	3,355		0.9 years
KK Australia	74		1.3 years
KK Mexico	231		1.4 years

Time-Vested Stock Options


	Share options outstanding at
(in thousands, except per share amounts)	March 31, 2024
KKI
Options	2,993
Weighted Average Grant Date Fair Value	$	5.90
Weighted Average Exercise Price	$	14.30

The unrecognized compensation cost related to the unvested stock options and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	7,311	2.1 years

No time-vested stock options under the KKI plan vested during the fiscal periods presented.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes For interim tax reporting, the Company estimates a worldwide annual effective tax rate and applies that rate to the year-to-date ordinary (loss)/income. The tax effects of significant unusual or infrequently occurring items are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur. The Company’s effective income tax rates were -177.5% and 16.2% for the quarters ended March 31, 2024 and April 2, 2023, respectively. The Company’s effective income tax rate for the quarter ended March 31, 2024 differed from the respective statutory rates primarily due to disallowed executive compensation expense, the mix of income and taxes attributable to foreign jurisdictions, and noncontrolling interest in domestic joint ventures. The Company’s effective income tax rate for the quarter ended April 2, 2023 differed from the respective statutory rates primarily due to disallowed executive compensation expense, the mix of income and taxes attributable to foreign jurisdictions, and a discrete tax benefit unrelated to ongoing operations

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Pending Litigation In March 2023, an employee filed a lawsuit on behalf of himself and all others similarly situated against the Company, alleging violations of the Illinois Biometric Information Privacy Act. In May 2023, the Company moved for a stay pending resolution of a similar case before the Illinois Supreme Court. The Company believes that it has meritorious defenses to the complaint and will vigorously defend against these claims. The Company has accrued an immaterial amount and management does not believe that this matter will have a material adverse effect on the Company’s financial results. Other Legal Matters The Company also is engaged in various legal proceedings arising in the normal course of business. The Company maintains insurance policies against certain kinds of such claims and suits, including insurance policies for workers’ compensation and personal injury, all of which are subject to deductibles. While the ultimate outcome of these matters could differ from management’s expectations, management currently does not believe their resolution will have a material adverse effect on the Company’s Condensed Consolidated Financial Statements. Other Commitments and Contingencies The Company’s primary banks issued letters of credit on its behalf totaling $13.3 million and $15.4 million as of March 31, 2024 and December 31, 2023, respectively, a majority of which secure the Company’s reimbursement obligations to insurers under its self-insurance arrangements.

Related Party Transactions	3 Months Ended
Related Party Transactions	Mar. 31, 2024
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions The Company has an equity ownership in three franchisees, KremeWorks USA, LLC (20% ownership), KremeWorks Canada, L.P. (25% ownership), and Krispy Kreme Doughnuts France SAS (“KK France”) (33% ownership), with an aggregate carrying value of $2.3 million and $2.8 million as of March 31, 2024 and December 31, 2023, respectively.

Revenue Recognition

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Disaggregation of Revenues

Revenues are disaggregated as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Company Shops, DFD and Branded Sweet Treats	$	420,213	$	392,814
Mix and equipment revenue from franchisees	13,299		17,860
Franchise royalties and other	9,186		8,276
Total net revenues	$	442,698	$	418,950

Contract Balances

Deferred revenue and related receivables are as follows:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Trade receivables, net of allowances of $450 and $564, respectively	$	50,212	$	45,858	Accounts receivables, net
Deferred revenue:
Current	$	21,772	$	22,066	Accrued liabilities
Noncurrent	7,714		6,005		Other long-term obligations and deferred credits
Total deferred revenue	$	29,486	$	28,071

Net Loss per Share

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Net Loss per Share

The following table presents the calculations of basic and diluted EPS:


	Quarter Ended
(in thousands, except per share amounts)	March 31, 2024		April 2, 2023
Net loss attributable to Krispy Kreme, Inc.	$	(8,534)	$	(301)


Additional income attributed to noncontrolling interest due to subsidiary potential common shares	(19)		(10)
Net loss attributable to common shareholders - Diluted	$	(8,553)	$	(311)
Basic weighted average common shares outstanding	168,685		168,141
Dilutive effect of outstanding common stock options, RSUs, and PSUs	—		—
Diluted weighted average common shares outstanding	168,685		168,141
Loss per share attributable to common shareholders:
Basic	$	(0.05)	$	0.00
Diluted	$	(0.05)	$	0.00

The following table summarizes the gross number of potential dilutive unvested RSUs and PSUs excluded due to antidilution (unadjusted for the treasury stock method):


	Quarter Ended
(in thousands)	March 31, 2024	April 2, 2023
KKI	6,637	5,097
KK U.K.	7	7
Insomnia Cookies	—	—
KK Australia	185	276
KK Mexico	—	—

Segment Reporting

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment Reporting

The reportable segment results are as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Net revenues:
U.S.	$	295,935	$	281,344
International	124,750		111,988
Market Development	22,013		25,618
Total net revenues	$	442,698	$	418,950


	Quarter Ended
	March 31, 2024		April 2, 2023
Segment Adjusted EBITDA:
U.S.	$	42,616	$	38,535
International	20,536		18,982
Market Development	11,900		11,551
Corporate	(16,864)		(14,140)
Adjusted EBITDA	58,188		54,928
Interest expense, net	13,736		11,988

Income tax expense	4,262		317
Depreciation and amortization expense	33,586		27,939
Share-based compensation	6,986		5,545
Employer payroll taxes related to share-based compensation	43		25
Other non-operating expense, net (1)	573		999
Strategic initiatives (2)	4,821		13,469
Acquisition and integration expenses (3)	248		91
New market penetration expenses (4)	466		94
Shop closure expenses/(income), net (5)	139		(679)
Restructuring and severance expenses (6)	6		580

Gain on sale-leaseback	—		(9,661)
Other (7)	(15)		2,577
Net (loss)/income	$	(6,663)	$	1,644

(1)Primarily foreign translation gains and losses in each period.

(4)Consists of start-up costs associated with entry into new countries for which the Company’s brands have not previously operated, including the Insomnia Cookies brand entering Canada and the U.K.

(6)The quarter ended April 2, 2023 consists primarily of costs associated with restructuring of the global executive team.

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events The Company evaluated subsequent events and transactions for potential recognition or disclosure in the Condensed Consolidated Financial Statements through May 9, 2024, the date the Condensed Consolidated Financial Statements were available to be issued. All subsequent events requiring recognition and disclosure have been incorporated into these Condensed Consolidated Financial Statements. On April 30, 2024, the Company’s Board of Directors declared a $0.035 per share cash dividend payable on August 7, 2024, to shareholders of record on July 24, 2024.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Apr. 02, 2023
Pay vs Performance Disclosure
Net loss attributable to Krispy Kreme, Inc.	$ (8,534)	$ (301)

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Description of Business and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	The Company operates and reports financial information on a 52 or 53-week year with the fiscal year ending on the Sunday closest to December 31. The data periods contained within fiscal years 2023 and 2024 will reflect the results of operations for the 52-week periods ended December 31, 2023 and December 29, 2024, respectively. The quarters ended March 31, 2024 and April 2, 2023 were both 13-week periods. The unaudited Condensed Consolidated Financial Statements include the accounts of KKI and subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, these interim financial statements do not include all information and footnotes required under GAAP for complete financial statements. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of results of operations, balance sheet, cash flows, and shareholders’ equity for the periods presented. All significant intercompany balances and transactions among KKI and subsidiaries have been eliminated in consolidation. Investments in entities over which the Company has the ability to exercise significant influence but which it does not control and whose financial statements are not otherwise required to be consolidated, are accounted for using the equity method.
Consolidation	These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto as of and for the year ended December 31, 2023, included in the Annual Report on Form 10-K. The Condensed Consolidated Balance Sheet as of December 31, 2023 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The results of operations for the quarter ended March 31, 2024 are not necessarily indicative of the results of operations that may be achieved for the entire fiscal year ending December 29, 2024. Noncontrolling interest in the Company’s Condensed Consolidated Financial Statements represents the interest in subsidiaries held by joint venture partners and employee shareholders. The joint venture partners hold noncontrolling interests in the Company’s consolidated subsidiaries, Awesome Doughnut, LLC (“Awesome Doughnut”), W.K.S. Krispy Kreme, LLC (“WKS Krispy Kreme”), and Krispy K Canada, Inc. (“KK Canada”). Employee shareholders hold noncontrolling interests in the consolidated subsidiaries Krispy Kreme Holding U.K. Ltd. (“KK U.K.”), Krispy Kreme Holdings Pty Ltd. (“KK Australia”), Krispy Kreme Mexico Holding S.A.P.I. de C.V. (“KK Mexico”), and Insomnia Cookies Holdings, LLC (“Insomnia Cookies”). Since the Company consolidates the financial statements of these subsidiaries, the noncontrolling owners’ share of each subsidiary’s net assets and results of operations are deducted and reported as noncontrolling interest on the Condensed Consolidated Balance Sheets and as net income attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations and comprehensive income attributable to noncontrolling interest in the Condensed Consolidated Statements of Comprehensive (Loss)/Income.
Reclassifications	Reclassifications Segment information is prepared on the same basis that the Company’s management reviews financial information for operational decision-making purposes. Effective January 1, 2024, the Company realigned its segment reporting structure such that the Company-owned Canada and Japan businesses have moved from the Market Development reportable operating segment to the International reportable operating segment. All segment information has been restated to be consistent with current presentation.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Additionally, it requires a public entity to disclose the title and position of the Chief Operating Decision Maker. The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. A public entity should apply the amendments in this standard retrospectively to all prior periods presented in the financial statements. We expect this standard to impact our segment disclosures, but with no impacts to our results of operations, cash flows, and financial condition. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which focuses on the rate reconciliation and income taxes paid disclosures. The standard requires a public business entity (“PBE”) to disclose, on an annual basis, a tabular rate reconciliation using both percentages and currency amounts, broken out into specified categories with certain reconciling items further disaggregated by nature and jurisdiction to the extent those items exceed a specified threshold. In addition, all entities are required to disclose income taxes paid, net of refunds received disaggregated by federal, state, and foreign and by individual jurisdiction if the amount is at least 5% of total income tax payments, net of refunds received. For PBEs, the standard is effective for annual periods beginning after December 15, 2024, with early adoption permitted. An entity should apply the amendments in this standard prospectively, with retrospective application permitted. We expect this standard to impact our income tax disclosures, but with no impacts to our results of operations, cash flows, and financial condition.

Inventories (Tables)

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Schedule of Inventory

The components of Inventories are as follows:


	March 31, 2024		December 31, 2023
Raw materials	$	23,594	$	21,000
Work in progress	470		211
Finished goods and purchased merchandise	15,193		13,505
Total inventories	$	39,257	$	34,716

Goodwill and Other Intangible Assets, net (Tables)

3 Months Ended

Mar. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill by Reportable Segment

Changes in the carrying amount of goodwill by reportable segment are as follows:


	U.S.		International		Market Development		Total
Balance as of December 31, 2023	$	677,956	$	294,468	$	129,515	$	1,101,939


Foreign currency impact	—		(3,113)		—		(3,113)
Balance as of March 31, 2024	$	677,956	$	291,355	$	129,515	$	1,098,826

Schedule of Indefinite-Lived Intangible Assets

Other intangible assets consist of the following:


	March 31, 2024						December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Amount		Gross Carrying Amount		Accumulated Amortization		Net Amount
Intangible assets with indefinite lives
Trade names and trademarks	$	657,990	$	—	$	657,990	$	657,980	$	—	$	657,980
Intangible assets with definite lives
Franchise agreements	30,390		(11,107)		19,283		30,390		(10,744)		19,646
Customer relationships	15,000		(6,629)		8,371		15,000		(6,413)		8,587
Reacquired franchise rights (1)	396,822		(143,619)		253,203		397,279		(137,143)		260,136

Total intangible assets with definite lives	442,212		(161,355)		280,857		442,669		(154,300)		288,369
Total intangible assets	$	1,100,202	$	(161,355)	$	938,847	$	1,100,649	$	(154,300)	$	946,349

Schedule of Finite-Lived Intangible Assets

Other intangible assets consist of the following:


	March 31, 2024						December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Amount		Gross Carrying Amount		Accumulated Amortization		Net Amount
Intangible assets with indefinite lives
Trade names and trademarks	$	657,990	$	—	$	657,990	$	657,980	$	—	$	657,980
Intangible assets with definite lives
Franchise agreements	30,390		(11,107)		19,283		30,390		(10,744)		19,646
Customer relationships	15,000		(6,629)		8,371		15,000		(6,413)		8,587
Reacquired franchise rights (1)	396,822		(143,619)		253,203		397,279		(137,143)		260,136

Total intangible assets with definite lives	442,212		(161,355)		280,857		442,669		(154,300)		288,369
Total intangible assets	$	1,100,202	$	(161,355)	$	938,847	$	1,100,649	$	(154,300)	$	946,349

Leases (Tables)

3 Months Ended

Mar. 31, 2024

Leases [Abstract]

Schedule of Supplemental Balance Sheet Information Related to Leases

The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:


		As of
		March 31, 2024		December 31, 2023
Assets	Classification
Operating lease	Operating lease right of use asset, net	$	456,810	$	456,964
Finance lease	Property and equipment, net	42,140		41,411
Total leased assets		$	498,950	$	498,375
Liabilities
Current
Operating lease	Current operating lease liabilities	$	50,275	$	50,365
Finance lease	Current portion of long-term debt	8,326		8,631
Noncurrent
Operating lease	Noncurrent operating lease liabilities	454,265		454,583
Finance lease	Long-term debt, less current portion	39,637		38,486
Total leased liabilities		$	552,503	$	552,065

Schedule of Lease Costs and Supplemental Cash Flow Information Related to Leases

Lease costs were as follows:


		Quarter Ended
		March 31, 2024		April 2, 2023
Lease cost	Classification
Operating lease cost	Selling, general and administrative expense	$	935	$	891
Operating lease cost	Operating expenses	24,023		22,390
Short-term lease cost	Operating expenses	1,085		1,281
Variable lease costs	Operating expenses	7,433		9,345
Sublease income	Royalties and other revenues	(35)		(35)
Finance lease cost:
Amortization of right of use assets	Depreciation and amortization expense	$	2,921	$	1,584
Interest on lease liabilities	Interest expense, net	877		573

Supplemental disclosures of cash flow information related to leases were as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)	$	31,124	$	29,145
Operating cash flows for finance leases	864		549
Financing cash flows for finance leases	2,593		1,696
Right of use assets obtained in exchange for new lease liabilities:
Operating leases	$	13,114	$	26,850
Finance leases	3,158		1,421

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following table presents assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023:


	March 31, 2024
		Level 2
Assets:

Interest rate derivatives		$	972
Commodity derivatives		341

Total Assets		$	1,313

Liabilities:
Foreign currency derivatives		$	599
Total Liabilities		$	599


	December 31, 2023
		Level 2
Assets:

Interest rate derivatives		$	1,596

Total Assets		$	1,596

Liabilities:
Foreign currency derivatives		$	345
Commodity derivatives		113
Total Liabilities		$	458

Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Condensed Consolidated Balance Sheets, Fair Value


	Derivatives Fair Value
Derivatives Not Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location

Commodity derivatives	$	341	$	—	Prepaid expense and other current assets
Total Assets	$	341	$	—
Foreign currency derivatives	$	599	$	345	Accrued liabilities
Commodity derivatives	—		113		Accrued liabilities
Total Liabilities	$	599	$	458


	Derivatives Fair Value
Derivatives Designated as Hedging Instruments	March 31, 2024		December 31, 2023		Balance Sheet Location
Interest rate derivatives	$	972	$	1,596	Prepaid expense and other current assets

Total Assets	$	972	$	1,596

Schedule of Derivative Instruments in Condensed Consolidated Statements of Operations, Gain (Loss)

The effect of derivative instruments on the Condensed Consolidated Statements of Operations for the quarters ended March 31, 2024 and April 2, 2023 is as follows:


	Derivative Gain Recognized in Income for the Quarter Ended
Derivatives Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative Gain Recognized in Income
Gain on interest rate derivatives	$	3,051	$	2,186	Interest expense, net
	$	3,051	$	2,186


	Derivative (Loss)/Gain Recognized in Income for the Quarter Ended
Derivatives Not Designated as Hedging Instruments	March 31, 2024		April 2, 2023		Location of Derivative (Loss)/Gain Recognized in Income
Loss on foreign currency derivatives	$	(254)	$	(924)	Other non-operating expense, net
Gain/(loss) on commodity derivatives	454		(118)		Other non-operating expense, net
	$	200	$	(1,042)

Vendor Finance Programs (Tables)

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

The following table presents liabilities related to vendor finance programs which the Company participates in as a buyer as of March 31, 2024 and December 31, 2023:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Supply chain financing programs	$	29,622	$	51,239	Accounts payable
Structured payables programs	133,809		130,104		Structured payables
Total Liabilities	$	163,431	$	181,343

Long-Term Debt (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

The Company’s long-term debt obligations consists of the following:


	March 31, 2024		December 31, 2023
2023 Facility — term loan	$	673,750	$	682,500
2023 Facility — revolving credit facility	207,500		155,000
Short-term lines of credit	17,000		11,000


Less: Debt issuance costs	(4,109)		(4,371)
Finance lease obligations	47,963		47,117
Total long-term debt	942,104		891,246
Less: Current portion of long-term debt	(60,326)		(54,631)
Long-term debt, less current portion	$	881,778	$	836,615

Share-based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Nonvested Restricted Stock Units Activity

RSU and PSU activity under the Company’s various plans during the periods presented is as follows:


(in thousands, except per share amounts)	Non-vested shares outstanding at December 31, 2023		Granted	Vested	Forfeited	Non-vested shares outstanding at March 31, 2024
KKI
RSUs and PSUs	6,785		104	164	88	6,637
Weighted Average Grant Date Fair Value	$	14.54	13.52	14.75	15.11	$	14.51
KK U.K.
RSUs	7		—	—	—	7
Weighted Average Grant Date Fair Value	$	29.80	—	—	—	$	29.80
Insomnia Cookies
RSUs	47		—	2	—	45
Weighted Average Grant Date Fair Value	$	120.21	—	74.12	—	$	122.42
KK Australia
RSUs	185		—	—	—	185
Weighted Average Grant Date Fair Value	$	1.57	—	—	—	$	1.57
KK Mexico
RSUs	20		—	—	—	20
Weighted Average Grant Date Fair Value	$	30.18	—	—	—	$	30.18

Share-based Payment Arrangement, Nonvested Award, Cost

The unrecognized compensation cost related to the unvested RSUs and PSUs and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	53,665	2.9 years
KK U.K.	94		2.2 years
Insomnia Cookies	3,355		0.9 years
KK Australia	74		1.3 years
KK Mexico	231		1.4 years

The unrecognized compensation cost related to the unvested stock options and the weighted average period over which such cost is expected to be recognized are as follows:


	As of March 31, 2024
	Unrecognized Compensation Cost		Recognized Over a Weighted Average Period of
KKI	$	7,311	2.1 years

Share-based Payment Arrangement, Option, Activity

A summary of the status of the time-vested stock options as of March 31, 2024 (with no options granted, exercised, or forfeited since December 31, 2023) is presented below:


	Share options outstanding at
(in thousands, except per share amounts)	March 31, 2024
KKI
Options	2,993
Weighted Average Grant Date Fair Value	$	5.90
Weighted Average Exercise Price	$	14.30

Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

Revenues are disaggregated as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Company Shops, DFD and Branded Sweet Treats	$	420,213	$	392,814
Mix and equipment revenue from franchisees	13,299		17,860
Franchise royalties and other	9,186		8,276
Total net revenues	$	442,698	$	418,950

Summary of Contract Balances with Customers

Deferred revenue and related receivables are as follows:


	March 31, 2024		December 31, 2023		Balance Sheet Location
Trade receivables, net of allowances of $450 and $564, respectively	$	50,212	$	45,858	Accounts receivables, net
Deferred revenue:
Current	$	21,772	$	22,066	Accrued liabilities
Noncurrent	7,714		6,005		Other long-term obligations and deferred credits
Total deferred revenue	$	29,486	$	28,071

Net Loss per Share (Tables)

3 Months Ended

Mar. 31, 2024

Earnings Per Share [Abstract]

Schedule of Net Loss Per Share, Basic and Diluted

The following table presents the calculations of basic and diluted EPS:


	Quarter Ended
(in thousands, except per share amounts)	March 31, 2024		April 2, 2023
Net loss attributable to Krispy Kreme, Inc.	$	(8,534)	$	(301)


Additional income attributed to noncontrolling interest due to subsidiary potential common shares	(19)		(10)
Net loss attributable to common shareholders - Diluted	$	(8,553)	$	(311)
Basic weighted average common shares outstanding	168,685		168,141
Dilutive effect of outstanding common stock options, RSUs, and PSUs	—		—
Diluted weighted average common shares outstanding	168,685		168,141
Loss per share attributable to common shareholders:
Basic	$	(0.05)	$	0.00
Diluted	$	(0.05)	$	0.00

Schedule of Antidilutive Unvested RSUs Excluded from Computation of Net Loss per Share

The following table summarizes the gross number of potential dilutive unvested RSUs and PSUs excluded due to antidilution (unadjusted for the treasury stock method):


	Quarter Ended
(in thousands)	March 31, 2024	April 2, 2023
KKI	6,637	5,097
KK U.K.	7	7
Insomnia Cookies	—	—
KK Australia	185	276
KK Mexico	—	—

Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The reportable segment results are as follows:


	Quarter Ended
	March 31, 2024		April 2, 2023
Net revenues:
U.S.	$	295,935	$	281,344
International	124,750		111,988
Market Development	22,013		25,618
Total net revenues	$	442,698	$	418,950


	Quarter Ended
	March 31, 2024		April 2, 2023
Segment Adjusted EBITDA:
U.S.	$	42,616	$	38,535
International	20,536		18,982
Market Development	11,900		11,551
Corporate	(16,864)		(14,140)
Adjusted EBITDA	58,188		54,928
Interest expense, net	13,736		11,988

Income tax expense	4,262		317
Depreciation and amortization expense	33,586		27,939
Share-based compensation	6,986		5,545
Employer payroll taxes related to share-based compensation	43		25
Other non-operating expense, net (1)	573		999
Strategic initiatives (2)	4,821		13,469
Acquisition and integration expenses (3)	248		91
New market penetration expenses (4)	466		94
Shop closure expenses/(income), net (5)	139		(679)
Restructuring and severance expenses (6)	6		580

Gain on sale-leaseback	—		(9,661)
Other (7)	(15)		2,577
Net (loss)/income	$	(6,663)	$	1,644

(1)Primarily foreign translation gains and losses in each period.

(4)Consists of start-up costs associated with entry into new countries for which the Company’s brands have not previously operated, including the Insomnia Cookies brand entering Canada and the U.K.

(6)The quarter ended April 2, 2023 consists primarily of costs associated with restructuring of the global executive team.

Description of Business and Summary of Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2024 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of reportable segments	3

Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 23,594	$ 21,000
Work in progress	470	211
Finished goods and purchased merchandise	15,193	13,505
Inventories	$ 39,257	$ 34,716

Inventories - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
Inventories - Narrative (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Apr. 02, 2023
Inventory Disclosure [Abstract]
Inventory write-off	$ 411	$ 7,115

Goodwill and Other Intangible Assets, net - Schedule of Goodwill (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 1,101,939
Foreign currency impact	(3,113)
Ending balance	1,098,826
U.S.
Goodwill [Roll Forward]
Beginning balance	677,956
Foreign currency impact	0
Ending balance	677,956
International
Goodwill [Roll Forward]
Beginning balance	294,468
Foreign currency impact	(3,113)
Ending balance	291,355
Market Development
Goodwill [Roll Forward]
Beginning balance	129,515
Foreign currency impact	0
Ending balance	$ 129,515

Goodwill and Other Intangible Assets, net - Schedule of Other Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023	Dec. 31, 2023
Intangible assets with definite lives
Gross Carrying Amount	$ 442,212		$ 442,669
Accumulated Amortization	(161,355)		(154,300)
Net Amount	280,857		288,369
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Gross Carrying Amount	1,100,202		1,100,649
Accumulated Amortization	(161,355)		(154,300)
Net Amount	938,847		946,349
Amortization of intangible assets	7,400	$ 7,300
Trade names and trademarks
Intangible assets with indefinite lives
Trade names and trademarks	657,990		657,980
Franchise agreements
Intangible assets with definite lives
Gross Carrying Amount	30,390		30,390
Accumulated Amortization	(11,107)		(10,744)
Net Amount	19,283		19,646
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Accumulated Amortization	(11,107)		(10,744)
Customer relationships
Intangible assets with definite lives
Gross Carrying Amount	15,000		15,000
Accumulated Amortization	(6,629)		(6,413)
Net Amount	8,371		8,587
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Accumulated Amortization	(6,629)		(6,413)
Reacquired franchise rights (1)
Intangible assets with definite lives
Gross Carrying Amount	396,822		397,279
Accumulated Amortization	(143,619)		(137,143)
Net Amount	253,203		260,136
Intangible Assets, Net (Excluding Goodwill) [Abstract]
Accumulated Amortization	$ (143,619)		$ (137,143)

Leases - Schedule of Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Assets
Operating lease	$ 456,810	$ 456,964
Finance lease	$ 42,140	$ 41,411
Finance lease assets, statement of financial position [Extensible Enumeration]	Property and equipment, net	Property and equipment, net
Total leased assets	$ 498,950	$ 498,375
Current
Current operating lease liabilities	50,275	50,365
Current finance lease liabilities	$ 8,326	$ 8,631
Finance lease liabilities, current, statement of financial position [Extensible Enumeration]	Current portion of long-term debt	Current portion of long-term debt
Noncurrent
Noncurrent operating lease liabilities	$ 454,265	$ 454,583
Noncurrent finance lease liabilities	$ 39,637	$ 38,486
Finance lease liabilities, noncurrent, statement of financial position [Extensible Enumeration]	Long-term debt, less current portion	Long-term debt, less current portion
Total leased liabilities	$ 552,503	$ 552,065

Leases - Schedule of Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Operating lease cost
Short-term lease cost	$ 1,085	$ 1,281
Variable lease costs	7,433	9,345
Sublease income	(35)	(35)
Amortization of right of use assets	2,921	1,584
Interest on lease liabilities	877	573
Selling, general and administrative expense
Operating lease cost
Operating lease cost	935	891
Operating expenses
Operating lease cost
Operating lease cost	$ 24,023	$ 22,390

Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Cash paid for leases:
Operating cash flows for operating leases	$ 31,124	$ 29,145
Operating cash flows for finance leases	864	549
Financing cash flows for finance leases	2,593	1,696
Right of use assets obtained in exchange for new lease liabilities:
Operating leases	13,114	26,850
Finance leases	3,158	1,421
Variable lease, payment	$ 7,400	$ 9,300

Leases - Additional Information (Details) $ in Thousands	3 Months Ended
Leases - Additional Information (Details) $ in Thousands	Mar. 31, 2024 USD ($) property	Apr. 02, 2023 USD ($) property
Leases [Abstract]
Leases, termination costs	$ 0	$ 900
Number of real estate properties \| property	0	1
Proceeds from sale-leaseback	$ 0	$ 10,025
Gain on sale-leaseback	$ 0	$ 9,661

Fair Value Measurements (Details) - Fair value, recurring - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Level 2
Assets:
Total Assets	$ 1,313,000	$ 1,596,000
Liabilities:
Total Liabilities	599,000	458,000
Level 2 \| Interest rate derivatives
Assets:
Derivative assets	972,000	1,596,000
Liabilities:
Derivative liabilities		113,000
Level 2 \| Commodity derivatives
Assets:
Derivative assets	341,000
Level 2 \| Foreign currency derivatives
Liabilities:
Derivative liabilities	599,000	345,000
Level 3
Assets:
Total Assets	0	0
Level 1
Assets:
Total Assets	$ 0	$ 0

Derivative Instruments - Additional Information (Details) $ in Thousands, gal in Millions			3 Months Ended
	Jul. 02, 2023 gal	Jan. 01, 2023 gal	Mar. 31, 2024 USD ($)	Apr. 02, 2023 USD ($)	Dec. 31, 2023 USD ($)
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Settlement of interest rate swap derivatives			$ 0	$ 7,657
2023 Facility \| Term Loan
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, amount of hedged item			505,000		$ 505,000
Derivatives Not Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative asset, fair value			341		0
Derivative liability, fair value			599		458
Derivatives Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative asset, fair value			972		1,596
Commodity derivatives \| Derivatives Not Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount (in gallon) \| gal	1.4	1.8
Derivative asset, fair value			300		100
Interest rate derivatives \| Derivatives Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			265,000
Interest rate derivatives \| Derivatives Designated as Hedging Instruments \| Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative asset, fair value			1,000		1,600
Foreign currency derivatives \| Derivatives Not Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount			50,100		49,800
Derivative liability, fair value			$ 600		$ 300
Interest Rate Contract, New Interest Rate Swap Agreement \| Derivatives Designated as Hedging Instruments
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, fixed interest rate			4.38%

Derivative Instruments - Schedule of Derivative Instruments in Condensed Consolidated Balance Sheets, Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	$ 341	$ 0
Derivative liability, fair value	599	458
Derivatives Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	972	1,596
Commodity derivatives \| Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	300	100
Foreign currency derivatives \| Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	600	300
Prepaid expense and other current assets \| Commodity derivatives \| Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative asset, fair value	341	0
Prepaid expense and other current assets \| Interest rate derivatives \| Derivatives Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	972	1,596
Accrued liabilities \| Commodity derivatives \| Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	0	113
Accrued liabilities \| Foreign currency derivatives \| Derivatives Not Designated as Hedging Instruments
Derivatives, Fair Value [Line Items]
Derivative liability, fair value	$ 599	$ 345

Derivative Instruments - Schedule of Derivative Instruments in Condensed Consolidated Statements of Operations, Gain (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative gain (loss) recognised in income, derivatives designated as hedging instruments	$ 3,051	$ 2,186
Derivative gain (loss) recognised in income, derivatives not designated as hedging instruments	200	(1,042)
Interest rate derivatives \| Interest expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative gain (loss) recognised in income, derivatives designated as hedging instruments	3,051	2,186
Foreign currency derivatives \| Other non-operating expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative gain (loss) recognised in income, derivatives not designated as hedging instruments	(254)	(924)
Commodity derivatives \| Other non-operating expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative gain (loss) recognised in income, derivatives not designated as hedging instruments	$ 454	$ (118)

Vendor Finance Programs (Details) - USD ($) $ in Thousands	3 Months Ended
Vendor Finance Programs (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Supplier Finance Program [Line Items]
Vendor finance program	$ 163,431	$ 181,343
Accounts Payable
Supplier Finance Program [Line Items]
Vendor finance program	29,622	51,239
Structured Payables
Supplier Finance Program [Line Items]
Vendor finance program	$ 133,809	$ 130,104
Supply Chain Financing Programs \| KKI
Supplier Finance Program [Line Items]
Period of trade payables payment	180 days
Supply Chain Financing Programs \| Vendors Under SCF Program
Supplier Finance Program [Line Items]
Period of trade payables payment	360 days

Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Less: Debt issuance costs	$ (4,109)	$ (4,371)
Finance lease obligations	47,963	47,117
Total long-term debt	942,104	891,246
Less: Current portion of long-term debt	(60,326)	(54,631)
Long-term debt, less current portion	881,778	836,615
Credit Facility
Debt Instrument [Line Items]
Short-term lines of credit	17,000	11,000
Term Loan \| 2023 Facility
Debt Instrument [Line Items]
Long-term debt, gross	673,750	682,500
Credit Facility \| 2023 Facility \| Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt, gross	$ 207,500	$ 155,000

Long-Term Debt - Narrative (Details) $ in Millions	1 Months Ended	3 Months Ended
Long-Term Debt - Narrative (Details) $ in Millions	Sep. 30, 2023 USD ($) agreement	Mar. 31, 2024 USD ($)	Dec. 31, 2023 USD ($)	Mar. 31, 2023 USD ($)
Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	$ 25.0
Debt instrument, basis spread on variable rate	1.75%
Number of agreements \| agreement	2
Secured Overnight Financing Rate (SOFR) \| Credit Facility
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	0.10%
2023 Facility \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Debt instrument, interest rate, stated percentage		7.43%	7.46%
2023 Facility \| Credit Spread Adjustment
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		0.10%
2023 Facility \| Leverage Ratio equal to or exceeds 4.00 to 1.00 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		2.25%
2023 Facility \| Leverage Ratio less than 4.00 to 1.00 but greater than or equal to 3.00 to 1.00 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		2.00%
2023 Facility \| Leverage Ratio less than 3.00 to 1.00 \| Secured Overnight Financing Rate (SOFR)
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		1.75%
2023 Facility \| Term Loan
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity				$ 700.0
Derivative, amount of hedged item		$ 505.0	$ 505.0
Debt instrument, interest rate, effective percentage		6.78%	6.80%
Revolving Credit Facility \| 2023 Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity				$ 300.0

Share-based Compensation - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option plan expense	$ 0.9	$ 0.9
KKI
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options vested (in shares)	0	0
Stock option exercised (in shares)	0
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock unit expense	$ 6.1	$ 4.7
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) \| KKI
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	104,000
Granted (in shares)	104,000

Share-based Compensation - Schedule of RSU Activity (Details) shares in Thousands	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Restricted Stock Units (RSUs) \| KK U.K.
RSUs and PSUs
Beginning balance, non-vested shares outstanding (in shares) \| shares	7
Granted (in shares) \| shares	0
Vested (in shares) \| shares	0
Forfeited (in shares) \| shares	0
Ending balance, non-vested shares outstanding (in shares) \| shares	7
Weighted Average Grant Date Fair Value
Beginning balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 29.80
Granted, weighted average grant date fair value (in USD per share) \| $ / shares	0
Vested, weighted average grant date fair value (in USD per share) \| $ / shares	0
Forfeited, weighted average grant date fair value (in USD per share) \| $ / shares	0
Ending balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 29.80
Restricted Stock Units (RSUs) \| Insomnia Cookies
RSUs and PSUs
Beginning balance, non-vested shares outstanding (in shares) \| shares	47
Granted (in shares) \| shares	0
Vested (in shares) \| shares	2
Forfeited (in shares) \| shares	0
Ending balance, non-vested shares outstanding (in shares) \| shares	45
Weighted Average Grant Date Fair Value
Beginning balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 120.21
Granted, weighted average grant date fair value (in USD per share) \| $ / shares	0
Vested, weighted average grant date fair value (in USD per share) \| $ / shares	74.12
Forfeited, weighted average grant date fair value (in USD per share) \| $ / shares	0
Ending balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 122.42
Restricted Stock Units (RSUs) \| KK Australia
RSUs and PSUs
Beginning balance, non-vested shares outstanding (in shares) \| shares	185
Granted (in shares) \| shares	0
Vested (in shares) \| shares	0
Forfeited (in shares) \| shares	0
Ending balance, non-vested shares outstanding (in shares) \| shares	185
Weighted Average Grant Date Fair Value
Beginning balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 1.57
Granted, weighted average grant date fair value (in USD per share) \| $ / shares	0
Vested, weighted average grant date fair value (in USD per share) \| $ / shares	0
Forfeited, weighted average grant date fair value (in USD per share) \| $ / shares	0
Ending balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 1.57
Restricted Stock Units (RSUs) \| KK Mexico
RSUs and PSUs
Beginning balance, non-vested shares outstanding (in shares) \| shares	20
Granted (in shares) \| shares	0
Vested (in shares) \| shares	0
Forfeited (in shares) \| shares	0
Ending balance, non-vested shares outstanding (in shares) \| shares	20
Weighted Average Grant Date Fair Value
Beginning balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 30.18
Granted, weighted average grant date fair value (in USD per share) \| $ / shares	0
Vested, weighted average grant date fair value (in USD per share) \| $ / shares	0
Forfeited, weighted average grant date fair value (in USD per share) \| $ / shares	0
Ending balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 30.18
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) \| KKI
RSUs and PSUs
Beginning balance, non-vested shares outstanding (in shares) \| shares	6,785
Granted (in shares) \| shares	104
Vested (in shares) \| shares	164
Forfeited (in shares) \| shares	88
Ending balance, non-vested shares outstanding (in shares) \| shares	6,637
Weighted Average Grant Date Fair Value
Beginning balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 14.54
Granted, weighted average grant date fair value (in USD per share) \| $ / shares	13.52
Vested, weighted average grant date fair value (in USD per share) \| $ / shares	14.75
Forfeited, weighted average grant date fair value (in USD per share) \| $ / shares	15.11
Ending balance, non-vested shares outstanding (in USD per share) \| $ / shares	$ 14.51

Share-based Compensation - Schedule of RSU Unrecognized Compensation Expense (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Restricted Stock Units (RSUs) \| KK U.K.
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 94
Recognized Over a Weighted-Average Period of	2 years 2 months 12 days
Restricted Stock Units (RSUs) \| Insomnia Cookies
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 3,355
Recognized Over a Weighted-Average Period of	10 months 24 days
Restricted Stock Units (RSUs) \| KK Australia
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 74
Recognized Over a Weighted-Average Period of	1 year 3 months 18 days
Restricted Stock Units (RSUs) \| KK Mexico
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 231
Recognized Over a Weighted-Average Period of	1 year 4 months 24 days
Restricted Stock Units (RSUs) and Performance Stock Units (PSUs) \| KKI
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 53,665
Recognized Over a Weighted-Average Period of	2 years 10 months 24 days

Share-based Compensation - Schedule of Stock Option Activity (Details) - KKI	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Options
Granted (in shares)	0
Exercised (in shares)	0
Forfeited or expired (in shares)	0
Ending balance, share options outstanding (in shares)	2,993,000
Weighted Average Grant Date Fair Value
Ending balance, share options outstanding (in USD per share) \| $ / shares	$ 5.90
Weighted Average Exercise Price
Ending balance, share options outstanding (in USD per share) \| $ / shares	$ 14.30

Share-based Compensation - Schedule of Stock Option Unrecognized Compensation Expense (Details) - Share-based Payment Arrangement, Option - KKI $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Compensation Cost	$ 7,311
Recognized Over a Weighted-Average Period of	2 years 1 month 6 days

Income Taxes (Details)	3 Months Ended
Income Taxes (Details)	Mar. 31, 2024	Apr. 02, 2023
Income Tax Disclosure [Abstract]
Effective income tax rate	(177.50%)	16.20%

Commitments and Contingencies (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Loss Contingencies [Line Items]
Letters of credit outstanding	$ 13.3	$ 15.4

Related Party Transactions (Details) $ in Millions	Mar. 31, 2024 USD ($) equity_method_investment	Dec. 31, 2023 USD ($)
Related Party Transaction [Line Items]
Number of franchisees \| equity_method_investment	3,000,000
Equity Method Investee
Related Party Transaction [Line Items]
Equity method investments \| $	$ 2.3	$ 2.8
KremeWorks USA, LLC
Related Party Transaction [Line Items]
Ownership percentage	20.00%
KremeWorks Canada, L.P.
Related Party Transaction [Line Items]
Ownership percentage	25.00%
Krispy Kreme France
Related Party Transaction [Line Items]
Ownership percentage	33.00%

Revenue Recognition - Summary of Disaggregation of Revenues (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Disaggregation of Revenue [Line Items]
Total net revenues	$ 442,698	$ 418,950
Company Shops, DFD and Branded Sweet Treats
Disaggregation of Revenue [Line Items]
Total net revenues	420,213	392,814
Mix and equipment revenue from franchisees
Disaggregation of Revenue [Line Items]
Total net revenues	13,299	17,860
Franchise royalties and other
Disaggregation of Revenue [Line Items]
Total net revenues	$ 9,186	$ 8,276

Revenue Recognition - Summary of Contract Balances with Customers (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Revenue from Contract with Customer [Abstract]
Trade receivables, net of allowances of $450 and $564, respectively	$ 50,212	$ 45,858
Trade receivables, allowance for credit loss	450	564
Deferred revenue:
Current	21,772	22,066
Noncurrent	7,714	6,005
Total deferred revenue	$ 29,486	$ 28,071

Net Loss per Share - Schedule of Net Loss Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Earnings Per Share [Abstract]
Net loss attributable to Krispy Kreme, Inc.	$ (8,534)	$ (301)
Additional income attributed to noncontrolling interest due to subsidiary potential common shares	(19)	(10)
Net loss attributable to common shareholders - Diluted	$ (8,553)	$ (311)
Basic weighted average common shares outstanding (in shares)	168,685	168,141
Dilutive effect of outstanding common stock options and RSUs (in shares)	0	0
Diluted weighted average common shares outstanding (in shares)	168,685	168,141
Net loss per share:
Basic earnings/(loss) per share (in dollars per shares)	$ (0.05)	$ (0.00)
Diluted earnings/(loss) per share (in dollars per shares)	$ (0.05)	$ (0.00)

Net Loss per Share - Schedule of Antidilutive Unvested RSUs Excluded from Computation of Net Loss per Share (Details) - Restricted Stock Units (RSUs) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
KKI
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	6,637	5,097
KK U.K.
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	7	7
Insomnia Cookies
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	0	0
KK Australia
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	185	276
KK Mexico
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	0	0

Net Loss per Share - Additional Information (Details) - shares shares in Millions	3 Months Ended
	Mar. 31, 2024	Apr. 02, 2023
Share-based Payment Arrangement, Option \| KKI
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of net loss per share	3.0	3.0

Segment Reporting (Details) $ in Thousands	3 Months Ended
Segment Reporting (Details) $ in Thousands	Mar. 31, 2024 USD ($) segment	Apr. 02, 2023 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments \| segment	3
Total net revenues	$ 442,698	$ 418,950
Segment adjusted EBITDA	58,188	54,928
Interest expense, net	13,736	11,988
Income tax expense	4,262	317
Depreciation and amortization expense	33,586	27,939
Share-based compensation	6,986	5,545
Employer payroll taxes related to share-based compensation	43	25
Other non-operating expense, net	573	999
Strategic initiatives	4,821	13,469
Acquisition and integration expenses	248	91
New market penetration expenses	466	94
Shop closure expenses	139	(679)
Restructuring and severance expenses	6	580
Gain on sale-leaseback	0	(9,661)
Other	(15)	2,577
Net (loss)/income	(6,663)	1,644
Strategic Initiatives
Segment Reporting Information [Line Items]
Global transformation, strategic alternatives, and McDonald's expansion	4,600
Property, plant and equipment impairments, inventory write-offs, employee severance, and other related costs		13,400
Corporate
Segment Reporting Information [Line Items]
Segment adjusted EBITDA	(16,864)	(14,140)
U.S.
Segment Reporting Information [Line Items]
Total net revenues	295,935	281,344
U.S. \| Operating Segments
Segment Reporting Information [Line Items]
Segment adjusted EBITDA	42,616	38,535
International
Segment Reporting Information [Line Items]
Total net revenues	124,750	111,988
International \| Operating Segments
Segment Reporting Information [Line Items]
Segment adjusted EBITDA	20,536	18,982
Market Development
Segment Reporting Information [Line Items]
Total net revenues	22,013	25,618
Market Development \| Operating Segments
Segment Reporting Information [Line Items]
Segment adjusted EBITDA	$ 11,900	$ 11,551

Subsequent Events (Details) - $ / shares		3 Months Ended
Subsequent Events (Details) - $ / shares	Apr. 30, 2024	Mar. 31, 2024	Apr. 02, 2023
Subsequent Event [Line Items]
Dividends declared on common stock and equivalents (in dollars per share)		$ 0.035	$ 0.035
Subsequent Event
Subsequent Event [Line Items]
Dividends declared on common stock and equivalents (in dollars per share)	$ 0.035