Starbucks profit climbs as US cafes prosper
NEW YORK (AP) - Americans still need their Starbucks fix even in the weak economy.
The Seattle-based coffee chain said its profit rose 13 percent in its fiscal first quarter, which was in line with Wall Street expectations. Results were boosted by a 6 percent increase in global sales at cafes open at least a year, a key metric of health.
In the flagship Americas region, Starbucks said the figure rose 7 percent as traffic and spending per visit increased with the help of holiday drinks such as the Pumpkin Spice Latte.
The introduction of the Verismo single-serve coffee machine in stores also added 0.5 percent to the sales increase in the Americas. The vast majority of the 150,000 machines Starbucks sold since its introduction in the fall was sold through specialty retailers, however.
In the China and Asia Pacific region, the figure rose 11 percent driven primarily by an uptick in traffic.
But in Europe, a persistent weak spot the company, the figure fell 1 percent. Starbucks executives have said they're working to turnaround the chain's performance in the region, in part by closing underperforming stores and improving customer service. Although traffic increased in Europe during the period, the amount people spent per visit declined.
"A lot of people were trading down it appears," said Troy Alstead, the company's chief financial officer, noting that fewer purchases included food.
For October-to-December period, Starbucks Corp. earned $432.2 million, or 57 cents per share. That's compared with $382.1 million, or 50 cents per share, in the year-ago period. Revenue rose 11 percent to $3.8 billion. Analysts expected a profit of 57 cents per share on revenue of $3.85 billion, according to FactSet.
The company affirmed its outlook for the year, with earnings expected to be between $2.096 and $2.15 per share, representing growth of 15 to 20 percent from the previous year.
The Seattle-based coffee chain said its profit rose 13 percent in its fiscal first quarter, which was in line with Wall Street expectations. Results were boosted by a 6 percent increase in global sales at cafes open at least a year, a key metric of health.
In the flagship Americas region, Starbucks said the figure rose 7 percent as traffic and spending per visit increased with the help of holiday drinks such as the Pumpkin Spice Latte.
The introduction of the Verismo single-serve coffee machine in stores also added 0.5 percent to the sales increase in the Americas. The vast majority of the 150,000 machines Starbucks sold since its introduction in the fall was sold through specialty retailers, however.
In the China and Asia Pacific region, the figure rose 11 percent driven primarily by an uptick in traffic.
But in Europe, a persistent weak spot the company, the figure fell 1 percent. Starbucks executives have said they're working to turnaround the chain's performance in the region, in part by closing underperforming stores and improving customer service. Although traffic increased in Europe during the period, the amount people spent per visit declined.
"A lot of people were trading down it appears," said Troy Alstead, the company's chief financial officer, noting that fewer purchases included food.
For October-to-December period, Starbucks Corp. earned $432.2 million, or 57 cents per share. That's compared with $382.1 million, or 50 cents per share, in the year-ago period. Revenue rose 11 percent to $3.8 billion. Analysts expected a profit of 57 cents per share on revenue of $3.85 billion, according to FactSet.
The company affirmed its outlook for the year, with earnings expected to be between $2.096 and $2.15 per share, representing growth of 15 to 20 percent from the previous year.
Happy for the employees but Howard can suck it.
 @snowman I just found Howard to be a little too full of himself, personally.
@Scoondog @snowman Agree with you there. I could only read the first 100 pages of his book becuase he was so full of himself and used tactics that should not have worked to expand starbucks.
 @Scoondog concur.
 @snowman How many jobs have you created in your life?  0?
What have you done to stimulate the global economy? 0?
 @cyclops MMM. about 10 jobs in the last 4 years. I am still bitter about Howard selling out the Sonics. I am laughing at "stimulate the global economy." That's rich. I hope you mean literally in reference to caffeine. After all I don't think Starbucks mission is to stimulate the economy its about earnings for them.Â
 @cyclops Thanks for the info on jobs and a global economy. I am sure Howard was thinking how he could strengthen the global economic conditions while providing jobs in China when he purchased the company from Baldwin. I imagine being worth 1.5 billion $ was secondary for him. Amazing how it works. As for my mission that's irrelevant and frankly nothing I have to answer to you. I've served my country and community to the best of my ability. Simply put, I distrust Schultz but if you read my first post I pull for the employees as they are the ones doing the heavy lifting. Have a great day.
 @snowman And your mission in your business is to make money for who?  Creating jobs stimulates the economy.