Industry News | July 25, 2016

Starbucks Reports Record Third Quarter

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Starbucks Corporation reported financial results for its 13-week fiscal third quarter and 39-week fiscal year to date ended June 26, 2016. Fiscal 2016 and fiscal 2015 GAAP results include items which are excluded from non-GAAP results.

Q3 Fiscal 2016 Highlights:

• Global comparable store sales increased 4 percent, comprised of a 4 percent increase in the Americas segment, a 3 percent increase in the China/Asia Pacific segment, and a 1 percent decline in the EMEA segment

• Consolidated net revenues grew 7 percent to a Q3 record $5.2 billion

• Consolidated GAAP operating income increased 9 percent to a Q3 record $1 billion

Non-GAAP operating income increased 9 percent over Q3 FY15 non-GAAP, to a Q3 record $1 billion

• Consolidated GAAP operating margin increased 30 basis points to a Q3 record 19.5 percent

Non-GAAP operating margin expanded 30 basis points over Q3 FY15 non-GAAP, to a Q3 record 19.8 percent

• GAAP EPS increased 24 percent to a Q3 record $0.51 per share

Non-GAAP EPS increased 17 percent over Q3 FY15 non-GAAP, to a record $0.49 per share

• Channel Development revenues grew 9 percent to a Q3 record $441 million; operating income increased 31 percent to a Q3 record $188 million; operating margin expanded 710 basis points to a Q3 record 43 percent

• The company opened 474 net new stores globally in Q3, bringing total stores to 24,395 in 74 countries worldwide

• Mobile Order and Pay usage reached 5 percent of U.S. transactions, up from 4 percent in Q2 FY16

• Membership in the company's Starbucks Rewards loyalty program increased 18 percent year-over-year to 12.3 million active loyalty members in the U.S.

“Starbucks record Q3 performance, highlighted by strong 7 percent comp growth and record revenues and profits in China and 18 percent year-over-year growth in our Starbucks Rewards loyalty program, demonstrates the strength and resilience of the Starbucks brand and business around the world,” says Howard Schultz, Starbucks chairman and CEO. “As we enter Q4 and approach fiscal 2017, we have clear line of sight to returning our U.S. business to historic levels of comp sales growth which had been at or above 5 percent for the 25 consecutive quarters prior to Q3.”

“Starbucks third quarter results once again reflect strong revenue and profit growth and represent the first non-holiday quarter in which our operating income exceeded $1 billion,” says Scott Maw, CFO. “We are confident in the correctness of the strategic, operational, and digital moves we outlined today and remain steadfast in our commitment to deliver significant, profitable growth over the long term.”

News and information presented in this release has not been corroborated by QSR, Food News Media, or Journalistic, Inc.

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