Retail coffee chain Starbucks (SBUX) has reported mixed second-quarter financial results even as its sales in China rebound strongly from the Covid-19 pandemic.
The Seattle-based coffeehouse and roastery announced earnings per share (EPS) of $1 U.S. versus $0.95 U.S. that was expected on Wall Street.
However, the company’s revenue in the quarter fell short of consensus analyst forecasts at $9.17 billion U.S. compared to $9.29 billion U.S. that was anticipated.
Starbucks’ operating margin expanded to 17.3% from 15.9% a year ago, driven by improvements in productivity and higher menu prices.
Same-store sales grew 10% in Q2, falling short of estimates of 11% growth. North American same-store sales grew 7%, missing estimates of 8.4%.
The soft same-store sales come despite a strong rebound in China, where same-store sales increased 46% in the quarter from a year earlier as Covid-19 restrictions in the nation of 1.4 billion people were removed.
Starbucks reaffirmed its 2023 outlook, forecasting revenue growth of 10% to 12%. The company raised its EPS growth estimate to 16% to 17% from the low end of 15% to 20%.
Starbucks’ stock has gained 21% in the past 12 months and currently trades at $101.26 U.S. per share.
