01—Abstract
Summary
Summary of the 10-Q filed January 30, 2024. Cited figures are marked; the original filing is the authoritative source.
Starbucks Corporation reported strong financial results for the first quarter of fiscal year 2024, ending December 30, 2023.
Total net revenues saw an increase of 8.2% to $9.4 billiona, driven by robust growth in both company-operated and licensed stores, particularly in North America and the International segment. This growth was fueled by a 5% increase in comparable store sales globally, with the U.S. market showing 5% growth and international markets achieving 7% growth. The company also demonstrated improved profitability, with operating margin increasing by 140 basis points to 15.8%, attributed to sales leverage and in-store operational efficiencies, despite increased investments in partner wages and benefits.
The company continued its strategic store expansion, adding 1,475 net new company-operated stores and 942 net new licensed stores globally during the past 12 months. Net earnings attributable to Starbucks rose to $1.024 billionb from $855.2 million in the prior year quarter. The company also returned significant capital to shareholders through dividends and share repurchases, reflecting confidence in its financial position and future outlook, underpinned by its "Triple Shot Reinvention with Two Pumps Plan."
02—Key points
Key Highlights
- Total net revenues increased by 8.2% to $9.4 billion for the quarter.
- Global comparable store sales grew by 5%, with the U.S. up 5% and International up 7%.
- Operating margin improved by 140 basis points to 15.8%, driven by efficiencies and sales leverage.
- Net earnings attributable to Starbucks increased to $1.024 billion from $855.2 million in the prior year quarter.
- The company added 1,475 net new company-operated stores and 942 net new licensed stores globally in the past 12 months.
- Significant capital was returned to shareholders through $648.1 million in dividends and $1.267 billion in share repurchases.
- Company-operated store revenue grew by 9.5%, driven by comparable store sales and new store openings.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed January 30, 2024Financial Statements
| Revenue | $9.43B |
| Operating Expenses | $8.00B |
| Operating Income | $1.49B |
| Interest Expense | $140.10M |
| Net Income | $1.02B |
| EPS (Basic) | $0.90 |
| EPS (Diluted) | $0.90 |
| Shares Outstanding (Basic) | 1.14B |
| Shares Outstanding (Diluted) | 1.14B |
05—Questions
Frequently Asked Questions
What were the main drivers of Starbucks' revenue growth in this quarter?
Starbucks' revenue growth was primarily driven by an 8.2% increase in total net revenues to $9.4 billion. This was fueled by higher revenues from company-operated stores (up 9.5%), which benefited from a 5% increase in comparable store sales (driven by a 3% increase in transactions and a 2% increase in average ticket) and incremental revenues from 1,475 net new company-operated stores. Licensed store revenue also increased by 6.5%, supported by 942 net new licensed store openings.
How did Starbucks' profitability perform in this quarter?
Starbucks demonstrated improved profitability, with operating income increasing by $232.3 million to $1.5 billion. The operating margin improved by 140 basis points to 15.8%. This improvement was primarily attributed to in-store operational efficiencies and sales leverage, which offset increased investments in store partner wages and benefits and higher general and administrative expenses.
What is the company's strategy for future growth?
Starbucks' growth strategy is underpinned by its "Triple Shot Reinvention with Two Pumps Plan," focusing on new store openings, comparable store sales growth, and operating margin management. The company continues to expand its store footprint globally, with a focus on disciplined capital allocation and enhancing customer experience and operational efficiencies.
How is Starbucks managing its cash and returning capital to shareholders?
Starbucks ended the quarter with $3.0 billion in cash and cash equivalents and actively manages its cash and investments to fund operations, debt payments, acquisitions, and shareholder returns. During the quarter, the company paid $648.1 million in dividends and repurchased $1.267 billion of its common stock, demonstrating its commitment to returning capital to shareholders.
06—Continue