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Starbucks (SBUX) earnings Q4 2019 meet estimates



Starbucks reported quarterly revenue on Wednesday, topping analysts' expectations as cafes in the US and China attracted more customers.

The shares of the company jumped more than 2% in expanded trading.

"Our U.S. business delivered 6% comparable store sales growth in the fourth quarter, while China increased comparable store sales by 5% and total transactions by 13%," CEO Kevin Johnson said in a statement.

This is what the company reported compared to what Wall Street expected, based on a survey of Refinitive analysts:

  • Earnings per share: $ 0.70, adjusted, against $ 0.70 expected
  • Revenue: $ 6.75 billion $ 6,68 billion expected
  • Global same-store sales: 5% versus 4% expected

The coffee chain reported net income in the fourth quarter of $ 802.9 million, or $ 0.67 per share, up from $ 755 , $ 8 million, or $ 56 a share, the year before.

The sale of the Tazo brand, Nestle-related transaction costs and other items earned Starbucks 70 cents per share, in line with estimates from analysts surveyed by Refinitive.

Net sales increased by 7% to $ 6.75 billion, topping expectations of $ 6.68 billion.

The company reported global growth in the same store of 5%. Both the US and China, the two largest markets, reported strong same-store sales and growing traffic.

In the US, sales in stores that were open for at least one year increased by 6%, driven by cold drinks. During the quarter, Starbucks introduced its first new pumpkin coffee drink since the pumpkin cross let: pumpkin cream brew. This summer, the coffee chain also expanded the distribution of cold brew Nitro in all company-run American stores, Johnson said. US cafes also increased traffic throughout the day, for the second quarter in a row.

Managers attributed US sales growth to employee investment, which benefits better and more hours, which in turn leads to higher customer satisfaction results. [19659003] After renewing the loyalty program last quarter, Starbucks now counts 17.6 million active reward members in the United States. Johnson said customers spend more when they join the loyalty program.

In China, despite increasing competition from Luckin Coffee and concern for a financial downturn, Starbucks had a 5% growth in the same store as more customers bought the products and used more. Delivery through the collaboration with Alibaba accounted for 7% of sales during the quarter.

The coffee chain opened more than 600 net new cafes in China during the 2019 fiscal year and now has more than 4,000 locations across the country. These new locations include a smaller cafe with limited seating in Beijing, similar to those developed by Luckin. Starbucks plans to construct even more of the smaller locations in fiscal 2020.

Starbucks also introduced its fiscal 2020 outlook. It expects to add 2,000 net new Starbucks locations worldwide, with continued expansion in the US and China. It expects sales growth in the range of 6% to 8% and global sales store growth in the same range from 3% to 4%.

"Our strong performance throughout the 2019 fiscal year gives us confidence in a robust operating outlook for fiscal 2020," Johnson said in a statement.

Starbucks also expects to spend about $ 1.8 billion on investment expenses.

The company expects fiscal 2020 adjusted, or non-GAAP, earnings per share in the range of $ 3 to $ 3.05. Analysts expected the coffee chain to report revenue from 2020 at $ 3.08 per share.

In September, Starbucks said it expects revenues in 2020 to be below its "ongoing growth model of 10%." The committee on Wednesday estimates that adjusted earnings per share will grow by 6% to 7.8%.

CFO Pat Grismer said in September that one-time tax benefits realized in the 2019 fiscal year would be headwinds and that Starbucks bought back $ 2 billion worth of shares earlier than originally planned.


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