Starbucks third quarter earnings report 2017

Starbucks third quarter earnings report 2017
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Investors await Starbucks‘ third-quarter earnings report, set to post after the closing bell Thursday, hoping that the company improved stateside same-store sales and fixed bottlenecking issues at its mobile-order pickup lines.

The coffee giant is expected to report earnings of 55 cents per share on $5.75 billion in revenue, according to Thomson Reuters estimates.

Analysts anticipate global same-store sales growth of 4.9 percent for the quarter, according to StreetAccount, but the chain has disappointed Wall Street in the previous two quarters, sending shares plummeting.

Part of these lackluster same-store sales came from congestion at hand-off counters that caused incoming customers to leave without making a purchase, despite lines at the register being short. In late April, CEO Kevin Johnson said that the company had “turned the corner’ on this issue.

Although, perhaps the biggest advantage to the brand during the quarter was its limited launch of the Unicorn Frappuccino.

In April, Starbucks received a lot of buzz on social media for the beverage, which quickly sold out at many locations. When it released last quarter’s results, the company said the Unicorn Frappuccino helped accelerate sales during that month.

The key for Starbucks will be if the Unicorn’s magic was sustained in May and June. Following the success of the sweet-and-sour beverage, Starbucks rolled out several new drinks during the quarter including the Midnight Mint Mocha Frappuccino, an Ombre Pink Drink and the Iced Coconutmilk Mocha Macchiato. But none elicited the same frenzy as the limited-time Unicorn.

In addition to same-store sales, investors will be looking for the company to delve deeper into how its decision to purchase the remaining 50 percent share of its East China business will impact its margins. The deal will cost the company about $1.3 billion and will give Starbucks ownership of 1,300 stores in the region.

In a separate deal, the company is set to sell its 50 percent stake in its Taiwanese joint venture for about $175 million. This joint venture operates about 410 Starbucks restaurants.

Both deals are set to close by early 2018.



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