Kevin Johnson, President and CEO of Starbucks, speaks during a press conference in Shanghai on August 2, 2018.
AFP | Getty Images
Starbucks reported mixed quarterly results Tuesday and raised its full-year guidance for earnings and sales.
While the company’s earnings exceeded Wall Street’s expectations, sales fell short of estimates, hurt by the slower recovery in some international markets.
The company’s shares fell nearly 2% in expanded trading.
The company reported, versus Wall Street expectations based on an analyst survey by Refinitiv:
- Earnings per share: 62 cents adjusted compared to 53 cents expected
- Revenue: $ 6.7 billion versus $ 6.8 billion expected
Starbucks reported net income of $ 659.4 million, or 56 cents per share, for the second quarter, compared to $ 328.4 million, or 28 cents per share, a year earlier.
Without articles, the coffee chain earned 62 cents per share, exceeding the 53 cents per share expected by the analysts surveyed by Refinitiv.
Net sales rose 11% to $ 6.7 billion, falling short of expectations of $ 6.8 billion. Global sales in the same store increased 15% as the company posted a 10% decrease from the same period last year.
Sales in the same store in the US rose 9% and returned to pre-pandemic levels. A year ago, sales in the same store in Starbucks’ home market fell 3% as lockdowns were introduced in the US. During the quarter, customers bought larger coffee orders and sent the average ticket by 21%. However, traffic is still declining by 10%.
Outside the US, sales in the same store rose 35%, although many European countries extended the lockdown. In China, Starbucks’ second-largest market, sales in the same store rose 91% as compared to the 50% decline last year over the same period. Transactions in China rose 93% in the quarter, but the average ticket fell 1%.
The company opened five new Netto cafes in the quarter. That includes the impact of the closings of around 300 locations in the US and Canada, announced back in June as part of a broader strategy to update the restaurant’s presence.
For the full 2021 fiscal year, Starbucks now expects earnings of $ 2.65 to $ 2.75 per share, compared to its previous range of $ 2.42 to $ 2.62 per share. Adjusted earnings of $ 2.90 to $ 3 per share are expected, compared to the previous outlook of $ 2.70 to $ 2.90 per share. Analysts had expected earnings per share of $ 2.85 for the fiscal year.
The company also increased its full-year revenue outlook from $ 28.5 billion to $ 29.3 billion to $ 28.5 billion to $ 29.3 billion. Wall Street forecast sales of $ 28.6 billion. Fiscal 2021 includes a 53rd week in which Starbucks is expected to generate approximately $ 500 million in revenue.
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