Starbucks returns to sales growth in fiscal second quarter – WSB-TV Channel 2
After four consecutive quarters of declining sales fueled by a pandemic, Starbucks is returning to growth.
The Seattle-based coffee giant said on Tuesday its sales rose 11% to $ 6.7 billion between January and March. It was just below Wall Street’s revenue forecast of $ 6.78 billion, according to analysts polled by FactSet.
Starbucks President and CEO Kevin Johnson said growth in the United States, in particular, exceeded expectations during the company’s fiscal second quarter. Johnson said sales in the United States increased in both urban and suburban areas __ and at all times of the day __ as vaccinations progressed.
“Customers crave human connection,” Johnson said on a conference call with investors. “While not all markets move at the same speed in terms of vaccine distribution, we know this is the key to getting us all together again.”
Comparable store sales in the United States – or sales in stores open at least one year – increased 9%, compared to a 3% decline in the same period last year. While in-store traffic fell 10% from a year ago, customers spent more, increasing the average ticket by 21%, Starbucks said.
This has been a trend throughout the pandemic as the usual habits of customers have been disrupted. Starbucks has seen fewer morning commuters grabbing a single coffee, but larger orders including snacks and frothy drinks when families and others go to drive-thru later in the day.
The new products also arouse the interest of customers. Johnson said sales of the plant-based Impossible breakfast sandwich, which was introduced last summer, hit an all-time high between January and March, while sales of alternative dairy drinks like a cold brew. based on almond milk __ increased by 53%.
Johnson said Starbucks’ plan to close about 400 stores in the United States was about 70 percent complete. The company is closing underperforming locations and replacing them, in some cases, with smaller pickup stores or stores with drive-thru windows.
“We meet our customers where they need us,” Johnson said.
In China, comparable store sales climbed 91% in the quarter, reflecting a recovery from store closings last year. But it was actually a slower pace that the company expected. A resurgence of the coronavirus dampened travel demand in the middle of the quarter, affecting Starbucks locations in places like airports, the company said.
Still, Starbucks opened 110 new stores in China during the quarter, and this week opened its 5,000th store in the country.
Starbucks said its global same-store sales jumped 15% for the quarter, their first increase in a year.
Starbucks said its net profit more than doubled to $ 659.4 million, or 56 cents per share. Excluding one-off items, the company earned 62 cents a share, well above the 53 cents expected on Wall Street.
Starbucks has raised its financial guidance for fiscal year 2021. The company is now forecasting revenues in the range of $ 28.5 billion to $ 29.3 billion, down from $ 28 billion to $ 29 billion previously. He also expects full-year adjusted earnings of $ 2.90 to $ 3 per share, up from $ 2.70 to $ 2.90.
Starbucks shares fell nearly 2% to $ 114.02 after the market on Tuesday.