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Krispy Kreme, the once legendary doughnut retailer that lost its allure through a combination of bad management, questionable relations with its franchisees and the bad timing of having carbohydrates go out of fashion, said yesterday that it was going to try to go into the ice cream business.

The announcement came as the company said it lost $7.4 million during the first quarter, a bigger loss than the $6 million it lost during last year's Q1. Revenue for the quarter was $110.9 million, down 7.1% from $119.4 million a year earlier.

According to CEO Daryl Brewster, the company is testing a proprietary ice cream product that will be sold as cones, cups and shakes, and also will make a doughnut sundae.
KC's View:
Krispy Kreme actually was good at making doughnuts, and it couldn’t make that business model work. Now, management wants to try and rescue the company by selling something that it isn't good at making.

Maybe we're just overly cynical, but we don’t get it. This sounds more like a desperation move than a clear strategy.