Starbucks Sees Profit Rising as Customers Return
April 27 2021 - 03:45PM
Dow Jones News
By Heather Haddon
Starbucks Corp. said it expects profit to increase this year as
sales recover at cafes that it is operating more efficiently than
before the coronavirus pandemic.
The coffee giant's sales plummeted last year as it closed stores
first in China then around the world as the pandemic took hold.
Starbucks has steadily reopened stores since last summer, when
pandemic-related restrictions on business and public gatherings
began to ease in parts of the U.S. It has also pushed mobile
ordering of beverages and increasing its to-go options.
Starbucks said Tuesday that global same-store sales in its
second-quarter ending in March increased 15% from the same period
last year. International markets accounted for much of the growth.
Same-store sales in the U.S. rose 9%.
Starbucks said it expects profit to rise more this year than it
previously expected. The chain updated its full-year guidance for
earnings of $2.65 to $2.75 a share, up from $2.42 to $2.62
previously. The chain also bumped up its projections for store
margins and sales.
The coffee giant is among restaurant companies working to draw
consumers back from the home-brewing habits they picked up during
the pandemic. Nestlé SA, the Swiss packaged-food company that makes
Starbucks-branded products in addition to its own, said last week
that at-home coffee sales drove its best quarterly sales growth in
almost a decade.
Starbucks has also drawn more people into its online loyalty
program as it has sought to boost in-person sales. The chain said
it had 23 million U.S. members in the latest quarter, a 18%
increase from last year. Members receive deals through repeat
purchases.
The chain is also developing more to-go oriented stores as it
phases out some sit-down locations. Starbucks said it closed 300
stores in the U.S. and Canada during the quarter as part of this
shift.
For the quarter, Starbucks reported earnings adjusted for
one-time items of 62 cents a share, outpacing expectations from
analysts polled by FactSet for earnings of 53 cents a share by that
metric. Sales of $6.7 billion neared expectations.
Write to Heather Haddon at heather.haddon@wsj.com
(END) Dow Jones Newswires
April 27, 2021 16:30 ET (20:30 GMT)
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