KANSAS CITY — The donut category received a retail boost during 2024, a trend that companies like Krispy Kreme Inc. and Shipley Do-Nuts hope continues as the calendar flips to 2025.

Krispy Kreme experienced growth in retail and distribution over the past year. In a Nov. 7 call with analysts on fiscal 2024 third-quarter results, Krispy Kreme executives said the Charlotte, NC-based company reached sales of $1.23 billion for the first three quarters of the year, up 1.9% from the same period a year earlier. Krispy Kreme also expanded its delivered-fresh-daily (DFD) business in the third quarter, completing successful DFD pilots in Los Angeles and Washington, adding more than 150 Target stores and expanding its presence at Walmart and Kroger.

Krispy Kreme aims to establish its presence in more than 15,000 points of access in the United States, including over 12,000 McDonald’s stores, by the end of 2026.

“To better align our talent and our capital to our business priorities, we are now restructuring our management teams to concentrate on maximizing our profitable expansion of the US while focusing international efforts on the wider adoption of our capital-light franchise model,” said Josh Charlesworth, chief executive officer of Krispy Kreme.

In late November, Krispy Kreme was hit by a cyberattack that disrupted operations, including online ordering. The company said in a Securities and Exchange Commission filing that it expects the incident to impact operations and financials until recovery efforts are completed.

“The expected costs related to the incident, including the loss of revenues from digital sales during the recovery period, fees for our cybersecurity experts and other advisers, and costs to restore any impacted systems, are reasonably likely to have a material impact on the company’s results of operations and financial condition,” Krispy Kreme stated in the filing. “The company holds cybersecurity insurance that is expected to offset a portion of the costs of the incident. The company does not expect this will have a long-term material impact on its results of operations and financial condition.”

Meanwhile, Houston-based Shipley Do-Nuts opened four new stores in its fiscal third quarter, increased its development pipeline and posted its 15th consecutive quarter of positive same-store sales. The company attributed the accelerated store openings to an expanded development team.

Shipley topped 360 units in 2024 and is on track to achieve back-to-back years of record openings. The company added more than 110 units to its development pipeline through November 2024 and in early December said it would expand its presence in Florida and Tennessee under a 22-unit franchise agreement with Virentes Partners Group. The company will enter two new states, North Carolina and Virginia, in the first quarter of 2025.

“With our faster development cycle, new stores now in the pipeline and some major multi-unit deals in the works, we are on pace to meet our aggressive growth goals,” said Keith Sizemore, senior vice president of franchise development at Shipley Do-Nuts. “We’re seeing tenured franchisees growing again while also attracting new franchisees to our system with our updated business model, proven profitability and product line that is perfect for multi-unit operators who want to diversify their portfolios.”

Product innovation helped drive engagement and increase sales over the past year, Shipley Do-Nuts said. In January, the company launched the Poptastic donut with freeze-dried Skittles, said to be its first limited-edition product in decades, followed by the Oreo Cookies & Dream donut in April, sold at more than 350 Shipley Do-Nuts locations through June 30. Shipley also operated an early test of its third-quarter promotion, the breakfast egg and cheese kolache line, which the company said far exceeded expectations and was the largest limited-time offering in its history.

“Our new kolaches and quarterly LTO donut releases represent our continual menu innovation to deliver exceptional experiences for our guests,” said Kaitlyn Venable, executive chef at Shipley Do-Nuts.

At Buffalo, NY-based Rich Products, Deborah Andrews, vice president of foodservice bakery marketing, attributed the donut category’s success to its alignment with leading consumer trends, including demand for indulgent sweet goods that offer affordability and convenience.

“Consumer snacking and a desire for personal indulgence/treats continues to grow, along with continued demand for grab-and-go options,” Andrews said. “Not only do donuts deliver on these trends, but they’re a lower price-point option than alternative indulgences, giving consumers a satisfying treat that won’t break the bank.”