Starbucks Corp. posted sales that beat estimates as U.S. and China transactions increased. But that wasn’t enough to satisfy investors following a 15 per cent run-up in the stock price this year.
Starbucks’s comparable sales rose 11 per cent in the quarter ended April 2. Analysts had projected a 7.3 per cent gain, according to data compiled by Bloomberg. Sales by that measure also surpassed estimates in both key growth markets of the U.S. and China.
The results underscore consumers’ resilience as they continue paying higher menu prices for discretionary items like oatmilk lattes. They also further reinforce that eating out is back: Last week, Chipotle Mexican Grill Inc. and McDonald’s Corp. also posted sales that topped Wall Street expectations. Starbucks said transactions grew 6 per cent in the U.S.
The shares, whose year-to-date gain is more than double that of the S&P 500 Index, slumped 1.5 per cent in late trading after the release of results. According to the earnings statement, executives will discuss its guidance for the full fiscal year on the upcoming call with analysts. Operating margin was 14.3 per cent, surpassing the average estimate from analysts. In North America, profitability was helped by higher prices and the lapping of pandemic-related pay a year earlier, among other factors.
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