After Thursday market close, Starbucks Corporation (NASDAQ: SBUX) announced the second quarter financial result for date ended March 27, 2016. Stock price tumbled 5.80% to $57.12 on Friday morning.
The world's largest coffee chain said global sales at cafes open at least 13 months increased 6% in the second quarter compared with the same quarter last year. According to research firm Consensus Metrix, analysts had expected an overall same-cafe sales gain of 6.7 percent.
Domestic sales drove the increase, with sales at U.S. locations rising 7%. That helped to offset slower growth in Europe, where the company’s business has been impact by terror attacks in Paris and Brussels and where the strong dollar continues to make its drinks and snacks more expensive in foreign currencies. Same-store sales in the Europe, Middle East and Africa division rose a smaller-than-expected 1% in the quarter.
"Starbucks record Q2 financial and operating performance - including a stunning 18% increase in revenues and a 5% increase in transactions in China - underscores the strength of the Starbucks brand and the resiliency of our global retail and CPG businesses," said Howard Schultz, chairman and CEO. "Loyalty, technology and innovation are continuing to fuel our digital flywheel and propel our business forward all around the world."
According to the second quarter financial result, Starbucks made profit of $575.1 million and earnings per share of $0.39which increased from $494.9 million and earnings per share of $0.33 last year. Revenue rose 9.4% to $4.99 billion compared with $4.56 billion in the same quarter last year.
“Starbucks Q2 represented another quarter of solid growth, with the highest revenues of any non-holiday quarter in our history and excellent financial, operating and profit performance,” said Scott Maw, CFO. “The record-setting performance we delivered in the first half of fiscal 2016 ideally positions us to benefit from the investments we are making in our partners, in our stores and in groundbreaking innovation, and to continue delivering world class returns to our shareholders into the future.”