Shares of Krispy Kreme, Inc. (DNUT) are soaring 16.58% in pre-market trading on Thursday following the release of its third-quarter 2025 financial results, which exceeded analyst expectations and demonstrated significant progress in the company's turnaround efforts. The iconic doughnut chain reported a surprise profit and announced a strategic overhaul of its distribution network, igniting investor optimism.

Krispy Kreme posted an adjusted earnings per share (EPS) of $0.01, beating the analyst consensus estimate of a $0.05 loss. The company's adjusted EBITDA came in at $40.6 million, substantially surpassing the expected $29.9 million, with an impressive adjusted EBITDA margin of 10.8%. While revenue slightly missed estimates at $375.3 million compared to the projected $381.6 million, investors appeared to focus on the company's improved profitability metrics.

CEO Josh Charlesworth outlined a new strategy to reshape Krispy Kreme's distribution network, prioritizing partnerships with major retailers like Walmart, Costco, and Target. This move follows the termination of its partnership with McDonald's and aims to increase visibility and profitability. Charlesworth stated, "We've had to exit from some customers, and have really been adding a lot of higher-traffic, higher-visibility customers where the conditions are right." The company is also implementing cost-cutting measures and exploring automation and AI to optimize operations, signaling a strong commitment to improving its financial performance and market position.