Krispy Kreme Reports Third Quarter Financial Results Beating Expectations

Retail donut chain Krispy Kreme reported its third quarter financial results this week that topped analyst expectations and also met expectations for its adjusted earnings per share.

For the third quarter, the company’s revenue jumped 18%. This was boosted by higher prices on fresh doughnuts.

CEO Mike Tattersfield said that the company has pricing power because customers are willing to spend more on fresh doughnuts. The comment was made after Krispy Kreme raised its prices in September and said it plans to raise them even more in the fourth quarter.

“Because we’re a dozens business, we have a lot more flexibility in how we price,” Tattersfield said in an interview. ”… We’re not a high frequency brand. People are still going to do celebrations, so they tend to look at the business like ‘Yes, I’d like to make sure we can have fresh doughnuts from Krispy Kreme.’”

Customers are also willing to pay up to 50% more for specialty doughnuts, Tattersfield added.

Tattersfield declined to provide detail on how much more customers are paying.

For the fiscal third quarter ended Oct. 3, the company reported that its net loss attributable to the company narrowed to $5.7 million, or 4 cents per share, from a net loss of $14.9 million, or 12 cents per share, a year earlier.

Excluding items, the company earned 6 cents per share. This was in line with analysts’ expectations.

Net sales reached $342.8 million in the quarter, coming ahead of Wall Street’s expectations of $337.7 million, per a survey of analysts by Refinitiv.

Looking ahead the company said it reiterated its outlook for the rest of 2021. It’s forecasting net revenue of $1.34 billion to $1.38 billion and organic revenue growth of 10% to 12%. The company is also expecting adjusted net income of $62 million to $68 million.

This is the second quarter that Krispy Kreme has reported since returning the public markets in July.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.