The company’s revenue-driving initiatives have been well received as evident by the company’s sales growth in all of its major markets.
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Starbucks said that revenue in its stores open at least a year – considered a key indicator of financial performance – jumped 8 percent in the fourth quarter. Analysts expect SSS to grow 6.9% in 4Q amid growth in Asia Pacific and China businesses. The company expects to report first quarter non-GAAP EPS of $0.44 to $0.45 and between $1.87 and $1.89 for the full year.
Starbucks shares bounced back during executives’ call with analysts, many of whom say the company is known to issue conservative forecasts at the start of its fiscal year.
Shares of Starbucks closed Thursday down 1.6% at $62.50, with a consensus analyst price target of $64.13 and a 52-week trading range of $37.46 to $63.84. Despite the decline, Starbucks raised the menu price on a few of its items in July, which effectively cost 1% more to the customers. The Starbucks app enables users to place their order before reaching the outlet, which ultimately results in lesser waiting time and shorter queues. It also includes Canada and Latin America. The coffee chain forecast an increase of 8%, while analysts had estimated a 7% increase. Starbucks has been among the brands that have been growing in China, despite slowing economic growth there and recent stock-market volatility. The company last year said it plans to double its USA food revenue to more than $4 billion over the next five years and that by the end of fiscal 2019, 20% to 25% of its US stores will offer food and alcoholic beverages in the evening.
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The company introduced its Mobile Order and Pay feature at 4,000 stores and believes that it had a direct impact on its traffic expansion as it is easy for clients to order and pay for drinks. Starbucks’ single-serve sales rose almost 41% y-o-y for the one month period ended September 5, 2015, primarily due to volume growth of 53% y-o-y over the same period.
