Starbucks Corporation (NASDAQ:SBUX) has recently declared its results for the third quarter of fiscal year 2014. Bloomberg TV’s Yang Yang analyzed better than estimated third quarter results posted by the $59.2 billion market capped beverage giant, on its popular ‘In The Loop‘ programming segment, and highlighted how “food actually drove” the “company sales and bottom-line”. The program also threw light on the new impetus being provided by Starbucks Corporation (NASDAQ:SBUX) Chairman of the Board, President, Chief Executive Officer Howard Schultz to experiment with a new lunch menu.
Yang Yang explained that, “Starbucks, as we all know, definitely a coffee company at its core, but for the third quarter, it was actually food that came out as the standout” performance. She also agreed with the analyst and the company’s management description that third quarter performance “was an outstanding and strong quarter” for the world’s top coffee maker.
Yang then proceeded to list out the highlights from the Seattle headquartered firm’s third quarter earnings report.
“They clocked in net income of some $513 million, about a 23% gain from a year ago. Earnings per share in at 67 cents, beating the street estimate by one cent, on revenue of $4.2 billion for the quarter. Global same-store sales growth, (that is a key number) clocked in at 6% for an impressive 18th consecutive quarter of com growth of 5% or more.”
Yang then walked through the market region wise break up in same store sales data, and pointed out that China, Asia Pacific and home market of U.S grew at an impressive 7 percent, while the Americas grew at 6 percent, followed by Europe, Middle East and Africa, which came in at 3 percent. She also went on to underline that, “Food drove 2 percent of comp growth in the united states alone”.
Looking ahead, she pointed to the optimism Starbucks Corporation (NASDAQ:SBUX) has voiced based on “the fact that as coffee costs rise, they have locked in about 60% of coffee prices for the next year, giving them a big leg up on their competitors”. She also underlined that optimism that is being displayed by the coffee chain major by saying that, “They have actually increased their earnings per share estimate for the current quarter up by 2 cents, now it is at 76 Cents”.
The report then went on to underline the changes that are being embraced by Starbucks Corporation (NASDAQ:SBUX) by pointing out Chairman and Chief Executive, Howard Schultz’s, comments after the earnings call in which he is quoted saying, “expect the lunch hour to look different.” These changes include increasing food items on the menu, opening up more number of 24 hour stores and strengthening its mobile ordering platform.