Starbucks reported record quarterly revenues Thursday behind a strong US performance, but weak China results and increased expenses pinched profits.

Comparable sales surged at the coffee chain's North American shops, lifted by a 10 percent increase in average ticket size following price hikes and a slight uptick in comparable transactions.

The results are the latest from a big US consumer-oriented company to illustrate continued robust consumer demand despite inflation.

Howard Schultz, interim chief executive, attributed the strong US performance to "reinvention" investments that have included boosts to employee compensation and store revamps as the chain confronts a unionization drive in its home market.

But the added spending on these areas -- coupled with increased commodity and supply chain costs -- dragged down Starbucks' bottom line.

Profits for the quarter ending October 2 were $878.3 million, down 50 percent from the year-ago period, while revenues climbed 3.3 percent to $8.4 billion.

The company continued to see meager results in China amid waves of Covid-19 restrictions in the country. Comparable sales dropped 16 percent in the period in the market.

With the coronavirus again on the rise in China, "we anticipate the current Covid-related uncertainty to continue," Schultz told analysts on a conference call.

"While our long-term aspirations for China remain undiminished, we expect the recovery of our business in the country to be nonlinear," Schultz said.

Shares of Starbucks rose 2.0 percent to $86.35 in after-hours trading.

Related Links
Global Trade News

Tweet

Thanks for being here; We need your help. The Space Media Network continues to grow but revenues have never been harder to maintain. With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords. Our news coverage takes time and effort to publish 365 days a year. If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.
SpaceMediaNetwork Contributor $5 Billed Once credit card or paypal		SpaceMediaNetwork Monthly Supporter $5 Billed Monthly paypal only

Asia joins Wall St plunge as Powell wrecks Fed pivot hopes
Hong Kong (AFP) Nov 3, 2022
Asian markets sank Thursday after the Federal Reserve hiked interest rates and boss Jerome Powell suggested they would go higher than expected, blowing a hole in hopes for a more dovish pivot in its fight against inflation. Equities have rallied for more than a week on speculation the US central bank would join others in tamping down its monetary-tightening campaign as the economy showed signs of slowing. On Wednesday, the bank unveiled a fourth straight 75 basis-point increase - the sixth hike ... read more