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Investing.com -- Krispy Kreme , Inc. (NASDAQ:DNUT) stock fell as much as 7% before paring losses to 4% on Tuesday after the doughnut maker and McDonald’s USA (NYSE:MCD) announced they will end their partnership, effective July 2, 2025.
The companies revealed they made the joint decision after determining the business model wasn’t financially viable for Krispy Kreme, despite meeting McDonald’s expectations. The partnership, which covered approximately 2,400 McDonald’s restaurants, will conclude next year.
"Our two companies partnered very closely, each supporting execution, marketing, and training, delivering a great consumer experience in approximately 2,400 McDonald’s restaurants," said Josh Charlesworth, Krispy Kreme CEO. "Ultimately, efforts to bring our costs in line with unit demand were unsuccessful, making the partnership unsustainable for us."
McDonald’s Chief Marketing and Customer Experience Officer Alyssa Buetikofer noted that while the collaboration was strong and Krispy Kreme delivered "high-quality product," the arrangement needed to be profitable for both companies.
For McDonald’s, Krispy Kreme represented a "small, non-material part" of its breakfast business, according to the announcement. The fast-food giant stated it remains focused on its breakfast strategy, which is a core pillar of its business.
Krispy Kreme indicated it will refocus on its strategy of expanding through high-volume retail distribution points in the U.S. and pursuing capital-light international franchise growth to drive sustainable future growth.
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