SEATTLE, U.S. – Starbucks Corporation yesterday reported financial results for its 13-week fiscal fourth quarter and 52-week fiscal year ended October 1, 2017.
Note that fiscal 2016 contained an extra week in the fourth quarter, resulting in incremental revenue and income in the comparable periods, which had 14- and 53-weeks, respectively.
Further, GAAP results in fiscal 2017 include items related to strategic actions the company is taking as it focuses on accelerating growth in high-returning businesses and streamlining its operations.
These items include restructuring and impairment charges, transaction and integration costs, gains related to changes in ownership of international markets, and other items, which are excluded from non-GAAP results.
A reconciliation of non-GAAP measures with their corresponding GAAP measures is available at the end of this release.
Q4 Fiscal 2017 Highlights
- Global comparable store sales increased 2%, driven by a 2% increase in average ticket and a 1% increase in transactions; up 3% excluding the impact from Hurricanes Harvey and Irma
- Americas comp store sales increased 3%, driven by a 2% increase in average ticket and a 1% increase in transactions
- S. comp store sales increased 2%; excluding the impact from Hurricanes Harvey and Irma, U.S. comp sales up 3%, driven by a 1% increase in transactions
- CAP comp store sales increased 2%; China comp store sales increased 8%, driven by a 7% increase in transactions
- Consolidated net revenues of $5.7 billion versus $5.7 billion in the prior year quarter. Excluding $412.4 million for the extra week in Q4 FY16, consolidated net revenues grew 8%
- GAAP operating income of $1.0 billion declined 16.7% compared to the prior year quarter. Non-GAAP operating income grew 2.8% to $1.1 billion
- GAAP operating margin of 17.9% declined 360 basis points compared to the prior year quarter. Non-GAAP operating margin of 20.0% declined 90 basis points primarily due to increased investments in our store partners
- GAAP Earnings Per Share of $0.54 was flat to the prior year quarter. Non-GAAP EPS grew 10.0% to $0.55 per share
- The company opened 603 net new stores globally, bringing total store count to 27,339 across 75 countries
- Membership in Starbucks Rewards grew 11% year-over-year to 13.3 million active members in the U.S., with member spend representing 36% of U.S. company-operated sales
- Mobile Order and Pay reached 10% of transactions in U.S. company-operated stores
Fiscal Year 2017 Highlights:
Global comparable store sales increased 3%, comprised of a 3% increase in the Americas segment and a 3% increase in the CAP segment
U.S. comp store sales increased 3%; China comp store sales increased 7%, driven by a 5% increase in transactions
Consolidated net revenues of $22.4 billion grew 5% versus the prior year. Excluding $412.4 million for the extra week in Q4 FY16, consolidated net revenues grew 7% year over year
GAAP operating income of $4.1 billion declined 0.9% compared to the prior year. Non-GAAP operating income grew 7.8% to $4.4 billion
GAAP operating margin of 18.5% declined 110 basis points compared to the prior year. Non-GAAP operating margin expanded 10 basis points to 19.7%
GAAP Earnings Per Share of $1.97 grew 3.7% versus the prior year. Non-GAAP EPS grew 11.4% to $2.06 per share
“Today, Starbucks reported another quarter – and year – of strong performance, with each of our business segments around the world contributing to record results,” said Kevin Johnson, ceo and president. “Food, beverage and digital innovation are bringing customers into our stores at the same time as ongoing operational improvements are enabling us to drive increased throughput – particularly in our busiest stores at peak – and deliver a further elevated Starbucks Experience to our customers.”
“Starbucks delivered solid top and bottom line growth – and our strongest quarterly traffic number in the U.S. since mid-2016 – despite a difficult operating environment in both the quarter and year,” said Scott Maw, cfo. “Continued strong growth and performance from CAP demonstrates that Starbucks now has two significant profit engines driving our global returns, our North America business and the broader CAP market.”