Starbucks was able to lure more customers in last quarter, but only in the United States did they also spend more. Elsewhere, consumers went for more, but cheaper cups of coffee.
Differences
Net sales rose 8 % to 9.4 billion dollars (8.6 billion euros) last quarter, which was + 5 % on a like-for-like basis – owing to 3 % more transactions and a 2 % increase in the average ticket. However, consumer behaviour differed by continent: in North America, an average purchase grew by 4 %, while transactions grew just by 1 %.
Internationally, comparable sales rose 7 %, but consumers spent 3 % less on their coffee. In China, transactions were up 21 % but the average ticket was down 9 %.
Multiple tracks
“Our first quarter performance was strong on many measures”, CEO Laxman Narasimhan thought. Particularly noteworthy was “the unwavering commitment of our most loyal customers”: the company’s Rewards membership programme gained 13 % more members, while they also spent more. The programme now has 34.3 million members in the US alone.
CFO Rachel Ruggeri says she is “proud” of the significant margin expansion and double-digit earnings growth, as it confirms the company’s multi-pronged approach: the coffee chain is committed to multiple growth paths, from physical expansion to higher ticket prices through personalised drinks. The gross profit margin rose 140 basis points to 15.8 %, while earnings per share climbed 22 %. A net 549 outlets were added during the quarter, making a total of 38,587. More than 40 % of all shops are in the United States.
