Segment Reporting (Tables)

9 Months Ended

Sep. 28, 2025

Schedule of Segment Reporting Information, by Segment

The reportable segment results are as follows:


	Quarter Ended				Three Quarters Ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
U.S.
Net revenues	$	216,187	$	228,376	$	682,830	$	813,615
Less:
Product and distribution costs, adjusted	53,574		56,837		168,160		192,807
Operating expenses, adjusted	126,175		129,402		400,921		428,971
Selling, general and administrative expense, adjusted	16,622		21,436		52,826		77,512
Marketing expenses, adjusted	7,343		6,860		21,585		23,493
Other segment items (1)	(8,537)		(82)		(7,513)		1,626
Depreciation expense and amortization of right of use assets, adjusted	14,886		12,974		48,405		45,074
Total U.S. Adjusted EBIT	$	6,124	$	949	$	(1,554)	$	44,132

International
Net revenues	$	140,237	$	130,697	$	392,627	$	380,716
Less:
Product and distribution costs, adjusted	32,021		31,352		89,747		92,417
Operating expenses, adjusted	67,961		61,535		197,022		177,359
Selling, general and administrative expense, adjusted	13,100		12,196		38,877		36,888
Marketing expenses, adjusted	4,284		2,786		10,162		8,793
Other segment items (1)	(286)		50		544		289
Depreciation expense and amortization of right of use assets, adjusted	8,280		7,783		24,016		23,024
Total International Adjusted EBIT	$	14,877	$	14,995	$	32,259	$	41,946

Market Development
Net revenues	$	18,874	$	20,794	$	54,792	$	67,043
Less:
Product and distribution costs, adjusted	5,746		7,603		16,403		25,265
Selling, general and administrative expense, adjusted	756		1,097		3,192		3,449
Other segment items (1)	378		823		3,208		2,283
Depreciation expense and amortization of right of use assets, adjusted	35		39		112		116
Total Market Development Adjusted EBIT	$	11,959	$	11,232	$	31,877	$	35,930

Corporate
Total Corporate expenses within Adjusted EBIT	$	(17,908)	$	(16,073)	$	(57,631)	$	(51,360)

Total Reportable Segment
Total reportable segment net revenues	$	375,298	$	379,867	$	1,130,249	$	1,261,374
Total reportable segment Adjusted EBIT	$	15,052	$	11,103	$	4,951	$	70,648

(1)The U.S. and International segments’ other segment items consist of pre-opening costs and other income, net. The Market Development segment other segment items consist of operating expenses, marketing expenses, pre-opening costs, and other income, net.

The following table presents a reconciliation of net loss/(income) to Adjusted EBIT:


	Quarter Ended				Three Quarters Ended
	September 28, 2025		September 29, 2024		September 28, 2025		September 29, 2024
Net (loss)/income	$	(20,131)	$	37,572	$	(494,654)	$	25,978
Interest expense, net	16,358		16,280		49,250		44,468
Income tax (benefit)/expense	(2,816)		17,679		(25,936)		18,330
Share-based compensation	774		9,969		8,011		24,603
Employer payroll taxes related to share-based compensation	26		49		283		299
(Gain)/loss on divestiture of Insomnia Cookies	—		(87,128)		11,501		(87,128)
Goodwill impairment	—		—		355,958		—
Other non-operating (income)/expense, net (1)	(591)		(407)		(2,161)		1,115

Strategic initiatives (2)	11,858		11,426		37,078		20,434
Acquisition and integration expenses (3)	—		1,938		(111)		3,037
New market penetration expenses (4)	208		156		528		1,194
Shop closure expenses, net (5)	502		21		36,497		788
Restructuring and severance expenses (6)	522		631		5,469		769
Gain on remeasurement of equity method investment (7)	—		(5,579)		—		(5,579)

Gain on sale-leaseback	—		—		(6,749)		—
Gain on refranchising (8)	(1,063)		—		(1,063)		—
Other (9)	1,504		716		7,658		(257)
Amortization of acquisition related intangibles (10)	7,901		7,780		23,392		22,597
Adjusted EBIT	$	15,052	$	11,103	$	4,951	$	70,648

(1)Primarily foreign translation gains and losses in each period, as well as equity method income from Insomnia Cookies following the divestiture of a controlling interest in Insomnia Cookies during fiscal 2024.

(2)The quarter and three quarters ended September 28, 2025 consist primarily of costs associated with the U.S. national expansion, including exit costs associated with termination of the Business Relationship Agreement with McDonald’s USA, and the evaluation of potential opportunities to refranchise certain equity markets. The quarter and three quarters ended September 29, 2024 consist primarily of costs associated with the divestiture of the Insomnia Cookies business, preparing for the U.S. national expansion (including McDonald’s USA), and global transformation.

(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 in which the Company’s brands have not previously operated, including Brazil and Spain.

(5)Includes lease termination costs, impairment charges, and loss on disposal of property, plant and equipment.

(6)The quarter and three quarters ended September 28, 2025 consist primarily of costs associated with restructuring of the U.S. and U.K. businesses. The quarter and three quarters ended September 29, 2024 consist primarily of costs associated with the restructuring of the U.K. executive team.

(7)Consists of a gain related to the remeasurement of the equity method investments in KremeWorks USA, LLC and KremeWorks Canada, L.P. to fair value immediately prior to the acquisition of the shops. Refer to Note 2, Acquisitions and Divestitures for further information.

(8)Includes gains and losses on the deconsolidation of assets and liabilities associated with the refranchising of Krispy Kreme shops.

(9)The quarter and three quarters ended September 28, 2025 consist primarily of $1.5 million and $6.8 million, respectively, in costs related to remediation of the 2024 Cybersecurity Incident, including fees for cybersecurity experts and other advisors. The quarter and three quarters ended September 29, 2024 consist primarily of legal and other regulatory expenses incurred outside the ordinary course of business, as well as a gain from insurance proceeds received related to a shop in the U.S. that was destroyed and subsequently rebuilt.

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

Krispy Kreme, Inc. 10-Q