S&P 500 (NYSE:SPY) component Starbucks Corporation (NASDAQ:SBUX) reported net income above Wall Street’s expectations for the third quarter. Starbucks Corporation purchases, roasts and sells whole bean coffees, along with brewed coffees, Italian-style espresso beverages, cold blended beverages and a selection of accessories.
Starbucks Earnings Cheat Sheet for the Third Quarter
Results: Net income for Starbucks Corporation rose to $279.1 million (36 cents per share) vs. $207.9 million (27 cents per share) in the same quarter a year earlier. This marks a rise of 34.2% from the year earlier quarter.
Revenue: Rose 12.3% to $2.93 billion from the year earlier quarter.
Actual vs. Wall St. Expectations: SBUX beat the mean analyst estimate of 34 cents per share. It beat the average revenue estimate of $2.85 billion.
Quoting Management: “Starbucks record third quarter results reflect both the underlying strength and continuing momentum we have been experiencing across all of our business segments and around the world,” said Howard Schultz, chairman, president and ceo. “These results demonstrate the power, and the extraordinary global potential, of our unique new business model. Starbucks has never been healthier, more connected to our customers and partners, or better positioned to go after the tremendous business opportunities that lie ahead,” Schultz added.
The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 20.4% and in the first quarter, the figure rose 43.5%.
Gross margin shrank 1.3 percentage points to 57.5%. The contraction appeared to be driven by increased costs, which rose 15.8% from the year earlier quarter while revenue rose 12.3%.
Revenue has now gone up for three straight quarters. In the second quarter, revenue rose 9.9% to $2.79 billion while the figure rose 8.4% in the first quarter from the year earlier.
The company beat estimates last quarter after being in line with expectations in the second quarter with net income of 34 cents per share.
Competitors to Watch: Einstein Noah Restaurant Group, Inc. (NASDAQ:BAGL), Panera Bread Company (NASDAQ:PNRA), Caribou Coffee Co., Inc. (NASDAQ:CBOU), Peet’s Coffee & Tea, Inc. (NASDAQ:PEET), McDonald’s Corporation (NYSE:MCD), Yum! Brands, Inc. (NYSE:YUM), Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR), Tim Hortons Inc. (NYSE:THI), Wendy’s Arby’s Group Inc. (NYSE:WEN), Sonic Corporation (NASDAQ:SONC) and Darden Restaurants (NYSE:DRI).
(Source: Xignite Financials)