Starbucks traffic surges, posts best sales growth in three years
By Nivedita Balu (Reuters) - Starbucks Corp attracted more customers in the latest quarter on an expanded line up of beverages and food offerings in the United States and China, leading the coffee chain to raise its fiscal 2019 profit forecast. Shares of the company rose nearly 6% to $96.40 after the bell and were on track to hit a record high, after the world's largest coffee chain posted its biggest same-store sales growth in three years. Starbucks has been trying to make its menu more appealing by adding new beverages such as the Dragon drink and Cocoa Cloud Macchiato, while also expanding the delivery side of its business with new partnerships.
By Nivedita Balu
(Reuters) - Starbucks Corp
Shares of the company rose nearly 6% to $96.40 after the bell and were on track to hit a record high, after the world's largest coffee chain posted its biggest same-store sales growth in three years.
Starbucks has been trying to make its menu more appealing by adding new beverages such as the Dragon drink and Cocoa Cloud Macchiato, while also expanding the delivery side of its business with new partnerships.
The added food options and Nitro Cold brew, a rich coffee that has a foamy texture like beer, lured more customers to stores during lunch hours, which is typically the slowest time of the day, the company said.
Those efforts led to a 3% growth in traffic in the second quarter.
"(Traffic is) an area where Starbucks has struggled," Edward Jones analyst Brian Yarbrough said. "A lot of investors were asking: 'When are you going to see a traffic increase?' ... This is a nice quarter on that standpoint."
The in-store traffic trend was encouraging as Starbucks and other restaurants had been raising prices to buffer bottom lines as more customers increasingly use mobile apps to order food and beverages.
The company has also been investing heavily in China by opening new stores and expanding delivery to cater to increased demand for on-the-go coffee.
Same-store sales rose 5% in China and the Asia-Pacific region, beating analysts' estimates of a 3.45% growth, according to IBES data from Refinitiv. In Americas, same-store sales surged 7%, above estimates of a 4.43% gain.
The company is now expecting same-store sales near the top end of its fiscal 2019 forecast of 3% to 4% growth and raised its earnings forecast to between $2.80 and $2.82 per share.
Total net revenue for the third quarter rose 8.1% to $6.82 billion. The company earned 78 cents per share.
Analysts had forecast a profit of 72 cents per share and revenue of $6.68 billion.
(Reporting by Nivedita Balu in Bengaluru; Editing by Bernard Orr and Anil D'Silva)
This story has not been edited by Firstpost staff and is generated by auto-feed.
NEW YORK (Reuters) -The price of cryptocurrencies plunged and crypto trading was delayed on Tuesday, a day in which El Salvador ran into snags as the first country to adopt bitcoin as legal tender. Shares of blockchain-related firms also fell as crypto stocks were hit by trading platform outages. But the major focus was on El Salvador, where the government had to temporarily unplug a digital wallet to cope with demand.
By Joseph White and Sanjana Shivdas (Reuters) -The head of Apple Inc's car project, Doug Field, is going to work for Ford Motor Co to lead the automaker's advanced technology and embedded systems efforts, a hiring coup for Ford Chief Executive Jim Farley.