Krispy Kreme Inc ( DNUT ) shares are trading higher after the company reported better-than-expected first-quarter FY24 earnings.

The company reported first-quarter FY24 sales growth of 5.7% year-on-year to $442.698 million, beating the analyst consensus estimate of $434.104 million.

Organic revenue growth of 6.7%, fueled by a 19.4% increase in Points of Access and the success of global brand activations including Valentine’s Day and St. Patrick’s Day doughnuts among others.

Digital sales as a percent of retail sales increased 340 basis points to 23.0% of sales. Revenue in the U.S. segment climbed 5.2% Y/Y, the International segment grew 11.4%, and Market Development decreased 14.1%.

Operating income declined 20.3% to $11.9 million, and the operating margin contracted 90 basis points to 2.7%.

Adjusted EBITDA increased 5.9% Y/Y to $58.2 million, and the EBITDA margin remained flat at 13.1%. Adjusted EPS of $0.07 beat the consensus estimate of $0.06.

The company held $33.6 million in cash and equivalents as of March-end. 

“First-quarter results exceeded our expectations, driven by increased digital sales and strong consumer demand, highlighted by a record setting Valentine’s Day with specialty doughnuts available in 33 countries around the world,” said CEO Josh Charlesworth.

Outlook Reaffirmed: Krispy Kreme sees FY24 net revenue growth of 5% – 7%. The company sees FY24 adjusted EPS of $0.27-$0.31 versus the Street view of $0.28.

Price Action: DNUT shares are trading higher by 4.05% at $13.23 in premarket at the last check Thursday.