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Financial Performance - Starbucks' global net revenue reached $8.8 billion, a 3% year-over-year increase[3] - The company's global operating margin was 8.2%, a decrease of 450 basis points year-over-year[3] - Diluted net earnings per share (EPS) were $0.41, a 38% year-over-year decrease[3] Sales and Store Growth - Overall comparable store sales decreased by 1%[3] - North America's comparable store sales decreased by 2%[3] - China's comparable store sales remained flat at 0%[3] - The global store count increased by 5% year-over-year, reaching 40,789 stores[3] Strategic Direction - The company is focused on its "Back to Starbucks" plan to improve the business[2] - Starbucks aims to re-introduce the Starbucks experience to the world by focusing on customer service, coffee quality, and community coffeehouses[6, 7, 8] - The company emphasizes its mission to be the premier purveyor of the finest coffee, inspiring and nurturing the human spirit[5]

Core Insights - Starbucks reported disappointing second-quarter fiscal 2025 results, leading to a 9.6% decline in stock price before market open on April 30, although it has since recovered by approximately 6.6% as of May 1 [1][3] Financial Performance - Adjusted earnings per share decreased by 39.7% year over year, from $0.68 to $0.41, missing the Zacks Consensus Estimate of $0.49 by 16.3% [3] - Total revenue increased by 2.3% year over year to $8.76 billion, but fell short of the Zacks Consensus Estimate of $8.79 billion [3] - Global comparable store sales declined by 1% year over year, driven by a 2% decrease in comparable transactions, partially offset by a 1% increase in average tickets [4] Operational Highlights - The company opened 213 net new stores, bringing the total store count to 40,789 [4] - Non-GAAP operating margin contracted by 4.60% to 8.2% due to deleverage and increased labor costs associated with the "Back to Starbucks" initiative [4] Segment Performance - North America segment net revenues were $6.47 billion, up 1% year over year, but operating margin contracted by 6.4% to 11.6% [5] - International segment net revenues increased by 6% year over year to $1.87 billion, with operating margin contracting by 1.7% to 11.6% [5] Strategic Initiatives - CEO Brian Niccol expressed optimism regarding the "Back to Starbucks" plan, which focuses on enhancing atmosphere, improving throughput, and boosting customer satisfaction through increased staffing and digital engagement [2]

Core Viewpoint - Starbucks reported better-than-expected first-quarter fiscal 2025 results, with earnings and net revenues exceeding estimates, but faced a decline in year-over-year earnings and flat revenues [2][5]. Financial Performance - Earnings per share (EPS) for the quarter was 69 cents, surpassing the Zacks Consensus Estimate by 4.6%, but down 23% from 90 cents in the prior-year quarter [5]. - Net revenues reached $9.398 billion, exceeding the consensus mark of $9.3 billion, and were nearly flat compared to $9.425 billion in the prior-year quarter [5]. - Global comparable store sales declined 4% year over year, driven by a 6% decrease in comparable transactions, partially offset by a 3% increase in average tickets [6]. Operational Insights - The company opened 377 net new stores globally, bringing the total store count to 40,576 [6]. - Operating margin contracted 390 basis points to 11.9% due to increased operating expenses and investments in the "Back to Starbucks" plan [7][8]. Segment Performance - North America segment net revenues were $7.072 billion, down 1% year over year, with comparable store sales declining 4% [9]. - International segment net revenues increased 1% to $1.871 billion, with comparable store sales also down 4% [10]. - Channel Development segment net revenues fell 3% to $436.3 million, attributed to declines in the Global Coffee Alliance and ready-to-drink revenues [12]. Strategic Initiatives - Starbucks aims to enhance sales growth through the "Back to Starbucks" plan, supply-chain efficiencies, menu simplification, and effective marketing campaigns [4]. - The company has suspended its guidance for fiscal 2025 but expects EPS to improve in the latter half of the fiscal year [17][18]. Financial Position - As of the end of the fiscal first quarter, cash and cash equivalents stood at $3.671 billion, up from $3.286 billion at the end of fiscal 2024 [14]. - Long-term debt was $14.312 billion, slightly down from $14.319 billion as of September 2024 [14]. Market Outlook - Estimates for Starbucks have trended downward, with a consensus estimate shift of -8.67% [20][21]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [23].