Starbucks(SBUX) - 2025 Q1 - Quarterly Report

Financial Performance - Total net revenues for the quarter ended December 29, 2024, were $9,397.8 million, a slight decrease of 0.3$9,425.3 million for the same quarter in 2023[13] - Operating income decreased to $1,121.7 million, down 24.5$1,485.4 million year-over-year[13] - Net earnings attributable to Starbucks were $780.8 million, a decline of 23.8$1,024.4 million in the prior year[13] - Earnings per share (EPS) on a diluted basis was $0.69, down from$0.90 in the same quarter last year, representing a decrease of 23.3%[13] - The company reported a comprehensive income of $626.3 million, significantly lower than$1,244.6 million in the same quarter last year, a decrease of 49.7%[15] - The company incurred total operating expenses of $8,322.6 million, which is an increase of 4.1$7,995.8 million in the same quarter last year[13] - For the quarter ended December 29, 2024, net earnings attributable to Starbucks were $780.8 million, a decrease of 23.7$1,024.4 million in the same quarter of the previous year[80] - Consolidated net revenues for Q1 fiscal 2025 were $9,397.8 million, a decrease of$28 million or 0.3% compared to Q1 fiscal 2024[98] Cash Flow and Investments - Cash provided by operating activities was $2,072.0 million, down from$2,383.9 million year-over-year, reflecting a decrease of 13.0%[20] - Cash and investments totaled $4.2 billion as of December 29, 2024, up from$3.8 billion as of September 29, 2024[122] - Net cash provided by operating activities was $2.1 billion for Q1 fiscal 2025, down from$2.4 billion in the same period of fiscal 2024, primarily due to a decrease in net earnings of $244 million[137] - Net cash used in investing activities totaled$855 million for Q1 fiscal 2025, compared to $569 million in Q1 fiscal 2024, mainly due to the acquisition of 23.5 Degrees Topco Limited and increased capital expenditures[138] - Net cash used in financing activities was$755 million for Q1 fiscal 2025, significantly lower than $2.4 billion in Q1 fiscal 2024, attributed to no share repurchases or long-term debt repayments in the current year[139] Assets and Liabilities - Total assets increased to$31,893.1 million, up from $31,339.3 million, indicating a growth of 1.8$9,725.3 million, compared to $9,070.0 million in the previous quarter, an increase of 7.2$(7,471.7) million, a decrease from $(7,448.9) million as of September 29, 2024[22] - The balance of retained earnings as of December 29, 2024, was$(7,256.4) million, a slight improvement from $(7,343.8) million as of September 29, 2024[22] - Total liabilities were reported at$85.9 million, with derivative liabilities accounting for $29.2 million[51] Stock and Dividends - The company declared cash dividends of$0.61 per share, totaling $693.4 million for the quarter ended December 29, 2024[22] - The Board of Directors approved a quarterly cash dividend of$0.61 per share, payable on February 28, 2025, to shareholders of record as of February 14, 2025[134] - The company repurchased common stock amounting to $(36.4) million during the quarter[22] - The company repurchased 12.8 million shares of common stock for$1,250.1 million during the quarter ended December 31, 2023, with 29.8 million shares remaining available for repurchase as of December 29, 2024[76] Store Operations and Growth - Starbucks operated more than 40,500 stores as of December 29, 2024, marking a 5% increase from the previous year[91] - The company opened a total of 377 new stores in Q1 fiscal 2025, including the conversion of 113 licensed stores to company-operated stores[121] - Beverage sales accounted for 60% of total revenues, amounting to $5,678.0 million, while food sales contributed 19$1,790.4 million[82] - Global comparable store sales declined by 4%, with a 4% decrease in both the U.S. and international markets[95] - Company-operated store revenue increased by $30 million, driven by 1,347 net new stores, a 7$4,203.0 million for the quarter ended December 29, 2024, compared to $3,851.5 million for the same quarter in the previous year, reflecting a rise of approximately 9.1$458.8 million, an increase from $417.4 million in the same quarter of the previous year[69] - Total lease costs for the quarter ended December 29, 2024, were$757.7 million, compared to $697.0 million for the same quarter in 2023[69] - Product and distribution costs as a percentage of total net revenues decreased by 80 basis points, primarily due to supply chain efficiencies[101] - Store operating expenses as a percentage of total net revenues increased by 380 basis points, primarily due to deleverage and investments in support of the "Back to Starbucks" plan[102] Derivative Instruments and Fair Value - The total fair value of outstanding derivative contracts as of December 29, 2024, was$4,197 million for cross-currency swaps[48] - The company recognized pre-tax gains of $12.8 million in other comprehensive income (OCI) for coffee hedges during the quarter ended December 29, 2024[47] - The total liabilities related to derivative instruments were$33.0 million as of December 29, 2024[49] - The company had derivative assets totaling $295.6 million classified under other long-term assets[49] - The cumulative amount of fair value hedging adjustment included in the carrying amount of long-term debt was$(28.4) million as of December 29, 2024[48]