Starbucks achieved remarkable financial results in the second quarter, setting a new record for revenue.Starbucks achieved remarkable financial results in the second quarter, setting a new record for revenue. The company's revenue surged by an impressive 12.5%, reaching an astounding $9.2 billion.
The company's net income increased by 25.1%, amounting to $1.14 billion, while operating income rose by 22.3%, reaching $1.6 billion. Per-share net income also experienced a surge of 25.3%, settling at $0.99. This growth was driven by enhanced productivity and higher pricing, which increased the operating margin to 17.3% from 15.9%.
Comparable sales at Starbucks coffee shops, which had been operational for at least a year, showed commendable growth of 10%, albeit slightly below the forecasts set by analysts. Notably, the North American market's comparable sales also fell short of expectations, with a growth rate of 7% compared to the anticipated 8.4%. Additionally, outside North America, comparable sales witnessed a 24% increase.
On a positive note, Starbucks' second-largest market, China, experienced a phenomenal growth rate of 46%, driven by post-pandemic recovery. During the third quarter, the company expanded its global presence by opening 588 new coffee shops worldwide, bringing the total number of Starbucks outlets to over 37,000. A significant portion of these outlets, namely 61%, operates in the United States and China. Looking ahead, Starbucks remains optimistic, forecasting revenue growth of 10-12% and an increase in earnings per share by 16-17% for the full fiscal year.
“Our strong third quarter results point to all-around momentum in the business, and reflect the significant progress we are making against our Reinvention Plan. Our results were also amplified by the distinctive competitive advantages that set us apart in the market,” commented Laxman Narasimhan, chief executive officer. “Starbucks is an iconic, durable brand and I am confident in the multiple paths available for the company to drive significant growth and margin improvement, which position us well to create outsized long-term shareholder value,” Narasimhan added.