by winston » Mon Jul 29, 2019 7:15 am
not vested
Starbucks earnings leap by 61pc to US$1.4b
Starbucks Corp served up an extra frothy third quarter, zooming past Wall Street’s forecasts thanks to new drinks and growing loyalty.
Based on the strong results, the Seattle-based coffee giant raised its full-year earnings guidance. It now expects adjusted earnings of US$2.80 to US$2.82 per share, up from US$2.75 to US$2.79.
Starbucks also said it expects global same-store sales growth of 4 percent, which is at the higher end of its previous forecast.
Starbucks shares, which closed at a record US$90.98 Thursday, climbed even higher in after-market trading.
Starbucks reported revenue of US$6.8 billion, up by 8 percen over the April-June period a year ago. That was higher than the US$6.7 billion analysts forecast, according to FactSet.
Net earnings jumped by 61 percent to US$1.4 billion. Adjusted for income tax benefits and other one-time items, Starbucks earned 78 US cents per share, beating Wall Street’s forecast 72 US cents.
Starbucks said sales at locations open at least 13 months — a critical measure known as same-store sales — were up by 6 percent globally, higher than the 4 percent growth analysts were predicting.
Starbucks said half that growth came from increased transactions while half was due to visitors spending more.
In the U.S., same-store sales grew by 7 percent.
Starbucks President and Chief Executive, Kevin Johnson, said new cold drinks, like its cloud macchiato and nitro cold brew, helped draw traffic, particularly in the afternoon. A year-old effort to make stores more efficient is also paying off, Johnson said.
Delivery is not yet a meaningful revenue driver in the U.S., where it is available at 2,700 stores in 11 markets, Johnson said. But it’s expected to be eventually. Earlier this week, Starbucks said it plans to expand delivery nationwide by early next year.
Johnson said Starbucks increased U.S. membership in its loyalty program by 14 percent to 17.2 million during the quarter and gave members more flexibility in how to spend their points. Around 42 percent of total U.S. spending came from loyalty members, he said.
“The acceleration we saw in active rewards members is paying off for us,” Johnson said.
Source: AP
It's all about "how much you made when you were right" & "how little you lost when you were wrong"