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Starbucks Tuesday mentioned Quarterly earnings and revenue beat analyst expectations, supported by better-than-expected international sales.
In China, the company’s second-largest market, Starbucks saw same-store sales increase for the first time since Starbucks’ fiscal third quarter in 2021, as customers returned to its coffee shops after rolling back Beijng’s zero-Covid policy.
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However, shares fell 5.6% in extended trading after executives reaffirmed its full outlook for the fiscal year.
Here’s what Starbucks said compared to what Wall Street was expecting, based on a poll of analysts conducted by Refinitiv:
- Earnings per share: 74 cents adjusted vs. 65 cents expected
- he won: 8.72 billion dollars, compared to the expected 8.4 billion dollars
The coffee giant reported second-quarter financial net income of $908.3 million, or 79 cents per share, up from $674.5 million, or 58 cents per share, a year earlier.
Excluding items, Starbucks earned 74 cents per share.
Net sales rose 14.2% to $8.72 billion. The company’s same-store sales rose 11% in the quarter, beating StreetAccount’s estimate of 7.1%. Both the US and international markets outperformed expectations.
“That’s great on any level, but specifically given the seasonal pressures that we typically see in (the second quarter),” Chief Financial Officer Rachel Ruggieri said on the company’s conference call.
Same-store sales in the US jumped 12% on a 6% increase in traffic. Some restaurant companies, such as the owner of Outback Steakhouse Bloomin Brandsthey reported diminished traffic as customers pulled out to eat out. Starbucks joins fellow outliers like McDonald’s And Chipotle Mexican Grillwhich also saw a jump in traffic.
The company said active American loyalty program members increased 15% from the year-ago period to 30.8 million during the quarter ended April 2.
Outside the United States, the coffee chain’s same-store sales increased 7%.
In China, the metric rose 3%. Starbucks China President Belinda Wong said the business saw same-store sales grow 30% in March, and that momentum continued into the fiscal third quarter.
“We’re very encouraged by the signs we’re seeing, but there’s a lot we’re navigating,” said Ruggieri.
Last quarter, then-CEO Howard Schultz said the company expects its China business to recover in the second half of fiscal 2023.
Starbucks reaffirmed its outlook for the fiscal year, Expect revenue growth 10% to 12% and adjusted EPS growth at the lower end of 15% to 20%.
Starbucks opened 464 net new locations during the quarter.
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