Starbucks earnings: Company posts its first global sales increase in nearly 2 years

Core Insights - Starbucks reported quarterly results that showed profits missed forecasts, but the first positive quarter of global same-store sales in nearly two years led to a rise in shares [1][3]. Financial Performance - In the fiscal fourth quarter ended September 28, Starbucks reported adjusted earnings per share of $0.52, missing forecasts of $0.55. Revenue was $9.6 billion, exceeding expectations of $9.34 billion [2]. - US same-store sales were flat, aligning with estimates, while same-store sales in China rose by 2%, slightly below the expected 2.2% [2]. Global Sales Trends - Global same-store sales increased by 1%, surprising analysts who forecasted a 0.5% decline, marking the first positive global comp sales in seven quarters [3]. - Following the earnings release, Starbucks stock initially rose by 3% but later lost gains in after-hours trading [3]. Strategic Changes - The company closed 627 stores during the fiscal year, with 90% located in North America, as part of a strategy to eliminate unprofitable locations and reduce corporate jobs, resulting in the elimination of 900 non-retail roles [4]. - CFO Cathy Smith indicated that the closed stores did not meet customer experience standards, despite potential profitability [5]. Market Outlook - Analyst Chris O'Cull noted that visitation trends have not improved in the current quarter, emphasizing that signs of same-store sales recovery during the holiday season will be crucial for near-term share price performance [6]. - CEO Brian Niccol expressed optimism about trends in the fiscal first quarter but acknowledged that customers are becoming more selective in their spending [6].