v3.26.1
Leases
 6 Months Ended
Jun. 28, 2026
Leases [Abstract]  
Leases Leases
The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:
As of
June 28, 2026December 28, 2025
Assets
Classification
Operating lease
Operating lease right of use assets, net
$350,029 $395,523 
Finance leaseProperty and equipment, net42,080 53,233 
Total lease assets$392,109 $448,756 
Liabilities
Current
Operating leaseCurrent operating lease liabilities$46,951 $51,213 
Finance leaseCurrent portion of long-term debt16,286 21,614 
Noncurrent
Operating leaseNoncurrent operating lease liabilities351,011 395,895 
Finance leaseLong-term debt, less current portion45,381 56,280 
Total lease liabilities$459,629 $525,002 

In connection with the WKS Refranchising, including the disposition of the California Assets and the Hawaii Assets, certain lease agreements associated with the transferred shops were assigned to W.K.S. Krispy Kreme. In instances where the Company was not relieved of its primary obligations under the original lease agreements, the Company accounts for these arrangements as subleases. Under ASC 842, the Company continues to recognize the operating lease liability and right-of-use asset for subleases that were determined to be operating leases. The Company derecognized right-of-use assets for subleases that were determined to be sales-type leases and recognized an immaterial investment in sublease and lease liability.
The Company remains contingently liable for lease payments in the event that W.K.S. Krispy Kreme defaults on the assigned lease obligations. The undiscounted maximum potential future payments under these lease arrangements were $12.4 million as of the balance sheet date. The Company has not recorded a liability for these guarantees as the likelihood of making future payments is not considered probable.
Refer to Note 3, Acquisitions and Divestitures, for more information on the impact of refranchising.

Lease costs were as follows:
Quarter Ended Two Quarters Ended
June 28, 2026June 29, 2025June 28, 2026June 29, 2025
Lease costClassification
Operating lease costSelling, general and administrative expense$691 $736 $1,329 $1,537 
Operating lease costOperating expenses19,457 22,988 41,547 45,101 
Short-term lease costOperating expenses303 1,562 777 2,745 
Variable lease costsOperating expenses5,974 8,078 12,023 15,075 
Sublease incomeRoyalties and other revenues(906)(92)(985)(176)
Finance lease cost:
 
 
Amortization of right of use assetsDepreciation and amortization expense$3,267 $5,746 $7,125 $11,042 
Interest on lease liabilitiesInterest expense, net962 1,524 2,067 2,988 
Supplemental disclosures of cash flow information related to leases were as follows:
Two Quarters Ended
June 28, 2026June 29, 2025
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)
$54,613 $61,102 
Operating cash flows for finance leases
2,089 2,981 
Financing cash flows for finance leases
7,343 10,744 
Right of use assets obtained in exchange for new lease liabilities:
Operating leases
$32,899 $34,018 
Finance leases
4,097 24,812 
(1)Operating cash flows for operating leases include variable rent payments, which are not included in the measurement of lease liabilities. Variable rent payments were $12.0 million for the two quarters ended June 28, 2026 and $15.1 million for the two quarters ended June 29, 2025.
In the two quarters ended June 28, 2026, the Company recognized a net loss of $3.2 million included in Other expenses, net on the Condensed Consolidated Statement of Operations, primarily related to the impairment and termination of leases related to fleet assets.

During the two quarters ended June 29, 2025, the Company completed two sale-leaseback transactions involving building and land properties for total proceeds of $10.9 million. The leasebacks were classified as operating leases, allowing the transactions to qualify as sales under ASC 842. As a result, the Company recognized a gain on sale of $6.7 million in Other income, net.
Leases Leases
The Company included the following amounts related to operating and finance lease assets and liabilities within the Condensed Consolidated Balance Sheets:
As of
June 28, 2026December 28, 2025
Assets
Classification
Operating lease
Operating lease right of use assets, net
$350,029 $395,523 
Finance leaseProperty and equipment, net42,080 53,233 
Total lease assets$392,109 $448,756 
Liabilities
Current
Operating leaseCurrent operating lease liabilities$46,951 $51,213 
Finance leaseCurrent portion of long-term debt16,286 21,614 
Noncurrent
Operating leaseNoncurrent operating lease liabilities351,011 395,895 
Finance leaseLong-term debt, less current portion45,381 56,280 
Total lease liabilities$459,629 $525,002 

In connection with the WKS Refranchising, including the disposition of the California Assets and the Hawaii Assets, certain lease agreements associated with the transferred shops were assigned to W.K.S. Krispy Kreme. In instances where the Company was not relieved of its primary obligations under the original lease agreements, the Company accounts for these arrangements as subleases. Under ASC 842, the Company continues to recognize the operating lease liability and right-of-use asset for subleases that were determined to be operating leases. The Company derecognized right-of-use assets for subleases that were determined to be sales-type leases and recognized an immaterial investment in sublease and lease liability.
The Company remains contingently liable for lease payments in the event that W.K.S. Krispy Kreme defaults on the assigned lease obligations. The undiscounted maximum potential future payments under these lease arrangements were $12.4 million as of the balance sheet date. The Company has not recorded a liability for these guarantees as the likelihood of making future payments is not considered probable.
Refer to Note 3, Acquisitions and Divestitures, for more information on the impact of refranchising.

Lease costs were as follows:
Quarter Ended Two Quarters Ended
June 28, 2026June 29, 2025June 28, 2026June 29, 2025
Lease costClassification
Operating lease costSelling, general and administrative expense$691 $736 $1,329 $1,537 
Operating lease costOperating expenses19,457 22,988 41,547 45,101 
Short-term lease costOperating expenses303 1,562 777 2,745 
Variable lease costsOperating expenses5,974 8,078 12,023 15,075 
Sublease incomeRoyalties and other revenues(906)(92)(985)(176)
Finance lease cost:
 
 
Amortization of right of use assetsDepreciation and amortization expense$3,267 $5,746 $7,125 $11,042 
Interest on lease liabilitiesInterest expense, net962 1,524 2,067 2,988 
Supplemental disclosures of cash flow information related to leases were as follows:
Two Quarters Ended
June 28, 2026June 29, 2025
Other information
Cash paid for leases:
Operating cash flows for operating leases (1)
$54,613 $61,102 
Operating cash flows for finance leases
2,089 2,981 
Financing cash flows for finance leases
7,343 10,744 
Right of use assets obtained in exchange for new lease liabilities:
Operating leases
$32,899 $34,018 
Finance leases
4,097 24,812 
(1)Operating cash flows for operating leases include variable rent payments, which are not included in the measurement of lease liabilities. Variable rent payments were $12.0 million for the two quarters ended June 28, 2026 and $15.1 million for the two quarters ended June 29, 2025.
In the two quarters ended June 28, 2026, the Company recognized a net loss of $3.2 million included in Other expenses, net on the Condensed Consolidated Statement of Operations, primarily related to the impairment and termination of leases related to fleet assets.

During the two quarters ended June 29, 2025, the Company completed two sale-leaseback transactions involving building and land properties for total proceeds of $10.9 million. The leasebacks were classified as operating leases, allowing the transactions to qualify as sales under ASC 842. As a result, the Company recognized a gain on sale of $6.7 million in Other income, net.