All the other warnings about pie charts also apply to donut charts: It must be clear what the sum of the donut chart stands for. All the pieces must add up to 100%. There should be fewer than seven categories or sections. The sections of the donut chart should be labeled because angles are hard to judge.
And, since it can be quite difficult to compare different sections of the donut chart, just like with a pie chart, donut charts are best used to compare the size of a particular slice with the whole, rather than comparing individual sections of the donut chart with each other. For comparing different categories of data against other categories, a bar chart may be more appropriate.
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Example of Donut Chart:
