July 2 will mark the official end of their fast-food partnership
Krispy Kreme and McDonald’s are terminating their partnership, with doughnut sales in McDonald’s restaurants officially ending on July 2, the companies announced Tuesday. The decision comes after months of underwhelming performance and paused rollout plans.
Originally intended to bring Krispy Kreme doughnuts to McDonald’s nationwide by 2026, the collaboration had expanded to 2,400 McDonald’s locations. But sales momentum faltered, leading to a pause in May and Krispy Kreme’s withdrawal of its full-year financial outlook amid broader economic softness.
“Ultimately, efforts to bring our costs in line with unit demand were unsuccessful, making the partnership unsustainable for us,” Krispy Kreme CEO Josh Charlesworth said in a statement. The company will now shift focus to high-volume retail locations and international franchise expansion.
Deal ended despite early promise
McDonald’s USA’s Chief Marketing and Customer Experience Officer, Alyssa Buetikofer, said the pilot went “well” for McDonald’s and its franchisees, but acknowledged that it had to be financially viable for Krispy Kreme too. The agreement was described as a non-material part of McDonald’s breakfast portfolio.
Financial realities ultimately overshadowed marketing potential. McDonald’s shares slipped slightly on the news, while Krispy Kreme stock rose more than 1%. Still, Krispy Kreme shares have plunged over 70% year-to-date, with the company reporting a $33 million loss in Q1.
Fast food industry faces spending pullback
McDonald’s is also feeling the pinch from reduced restaurant spending as inflation and tariffs weigh on consumer wallets. In Q1, the company recorded its worst same-store sales decline since 2020 and has been trying to reverse the trend with new value-driven promotions.
While the Krispy Kreme collaboration once looked like a sweet bet, the failure to balance unit economics with customer demand proved too steep a challenge. The end of the partnership signals a broader shift as fast-food giants focus more on cost efficiency and targeted growth.
