Krispy Kreme Slapped With Investor Lawsuit Over McDonald’s Rollout Delay

Krispy Kreme has been slapped with an investor lawsuit over its recent decision to indefinitely delay the collaboration with McDonald’s.

According to QSR, the class-action lawsuit claims the doughnut chain failed to disclose that demand had decreased following the initial marketing campaign, that the collaboration was unprofitable, and that the business would halt development into new McDonald’s shops.

McDonald’s is one of Krispy Kreme’s Delivered Fresh Daily (DFD) sites that get fresh doughnuts daily, such as convenience stores, gas stations, warehouse clubs, and grocery stores. The doughnut chain also collaborates with Target, Walmart, and Kroger.

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Investors who bought Krispy Kreme stock between Feb. 25 and May 7 are eligible for the class-action complaint.

What Happened With the Krispy Kreme and McDonald’s Collaboration?

In late 2024, Krispy Kreme revealed intentions to send fresh doughnuts to McDonald’s outlets across the country in the coming years. The long-term goal was to have doughnuts available at over 12,000 McDonald’s restaurants by the end of 2026. So far, the brand is available in 2,400 locations.

“We’re pleased with many aspects of the McDonald’s partnership,” Krispy Kreme CEO Josh Charlesworth told investor analysts during the Q1 earnings call. “The execution across all the cities has been very good. Our teams have worked well together, making sure we have awesome fresh doughnuts readily available. I think it’s also important to understand that we need it to be profitable on a sustainable basis over a long term.”

He continued: “So really, what we’re doing working with them is to make sure that the availability and the visibility of the doughnuts is consistently prominent and that our operations are as simplified and streamlined as they can be. So really, our focus through 2,400 restaurants we’re in today is making sure we’re positioned for profitable growth before we expand further.”

However, on May 8, the two companies announced that the collaboration was being “reevaluated.” Thus far, there have been no announcements as to when it will be relaunched or even if it will be relaunched at all.

“I remain confident in the long-term national opportunity, but we need to work together with them to identify levers to improve sales,” said Charlesworth, per CNBC.