Starbucks Corporation managed to attract more customers during the latest quarter due to an expanded selection of beverages and food on its menu, particularly in United States and China, which has resulted in the global coffee chain to change its fiscal 2019 profit forecast for the better.
The company’s shares managed to increase by almost 6% to €86.76 ($96.40), whilst also being on track to reach a record high. This comes after the world’s largest coffee chain managed to record its biggest same-store sales growth in three years.
Starbucks have managed to make their menu more appealing in several outlets around the world, particularly by adding new beverages, one of which being the Dragon drink. Apart from this, the company has also expanded the delivery side of its businesses by introducing new partnerships.
The more attractive menu setup has led to a 3% growth in in-store traffic during the second quarter.
An analyst of the famous investment company, Edward Jones Investments, Brian Yarbrough, stated that “A lot of investors were asking: ‘When are you going to see a traffic increase?’ … This is a nice quarter on that standpoint.”
This increase in in-store traffic has been encouraging for Starbucks as well as to other restaurants, after they were forced to raise their prices and to try and compete with customers constantly using mobile applications to order food and beverages in a quicker manner.
Remarkably, the company has also been increasing its investment in China by a great deal, opening new stores whilst also expanding delivery to cater for the increased demand for take-away coffee.
The company experienced a same-store sales growth of 5% in China and the Asia-Pacific region, which exceeds the analysts’ anticipated growth of 3.45%. In the Americas, the company managed to register a same-store sales growth of 7%, much higher than the estimated 4.43% growth.
The total net revenue for the third quarter increased by 8.1% to a staggering €6.14 billion ($6.82 billion), with the company earning €0.70 ($0.78) for every share. Once again, these values exceed the anticipated results, with analysts forecasting a profit of €0.65 ($0.72) as well as a revenue of €6.01 billion ($6.68 billion).