I don't think I've ever heard it to have a racial meaning. From the central US, the times I've heard it used it either referred to someone as fat, or referred to someone as having eaten too many donuts. The first is more common from where I come from. If someone is fat, the sometimes are said to have a "Spare tire" hanging around their middle, or sometimes, it may be said that they have a donut. I actually don't know if it is supposed to mean their belly button is the hole in the donut/tire, or if it means it goes around thier waiste. Either way, it means "Fat" in that sense. In another sense, it still means fat or soft, but refers to an old American expression that says "You are what you eat." In that case, a donut would be someone who eats junk food, and as a result, is soft, or out of shape. I think there are many meanings. Where the person is from, and the context of the conversation probably helps us answer the question. Of course, somtimes, people just make stuff up because it sounds funny. This could be such a case.

In my experience (UK), "donut" . "doughnut" is a mild term of abuse like "idiot" without any racial or discriminatory connotation.

I have never heard "donut" used in that way.

Dan from the US and I (Richard from Canada) have never heard the word "donut" used to describe or refer to a person, so it may not be a very common expression. However, both Michael and Steve have heard it used.