Starbucks stock pops on earnings beat, sales growth in U.S., China

Starbucks stock pops on earnings beat, sales growth in U.S., China

U.S., China markets perform ‘extremely well,’ Starbucks says; guidance raised

Shares of Starbucks Corp. rose nearly 6% in the extended session Thursday after the company reported fiscal third-quarter profit and sales above Wall Street expectations and raised its guidance for the year.

Starbucks SBUX, +0.36% reported earnings of $1.4 billion, or $1.12 a share, in the quarter, compared with $853 million, or 61 cents a share, in the year-ago period.

Adjusted for one-time items, the company earned 78 cents a share in the quarter, compared with 62 cents a share a year ago. Revenue rose to $6.8 billion, from $6.3 billion.

Analysts polled by FactSet had expected the company to report adjusted third-quarter earnings of 72 cents a share on sales of $6.7 billion.

“Our two targeted long-term growth markets, the U.S. and China, performed extremely well across a number of measures as a result of our focus on enhancing the customer experience, driving new beverage innovation and accelerating the expansion of our digital customer relationships,” Chief Executive Kevin Johnson said in a statement.

Americas comparable-store sales rose 7%, thanks to a 4% increase in average ticket and a 3% increase in transactions, the company said. U.S. comparable-store sales also increased 7%.

Same-store sales in China and the Asia-Pacific region increased 5%, driven by a 3% increase in average ticket and a 2% increase in transactions, Starbucks said. Globally, same-store sales rose 6%.

Starbucks said it expects sales growth of about 7%, versus a previous guidance of 5% growth. Global same-store sales are seen increasing 4%, from a previous guidance of 3% to 4% growth.

The company earlier this week reported a deal with Uber Eats, a unit of Uber Technologies Inc., to launch a nationwide delivery program, and that it would take an equity stake in restaurant tech company Brightloom, previously called Eatsa.

Shares of Starbucks have gained 41% this year, compared with gains of 20% for the S&P 500 index. SPX, -0.53%

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