Starbucks beats earnings and revenue estimates, despite lockdowns in China (CNBC)

Starbucks on Tuesday reported better-than-expected quarterly earnings and revenue, despite lockdowns in China weighing on its performance.

Here’s what the company reported for the quarter ended July 3 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

• EPS: 84 cents adjusted vs. 75 cents expected

• Revenue: $8.15 billion vs. $8.12 billion expected

• The coffee giant reported fiscal third-quarter net income attributable to Starbucks of $912.9 million, or 79 cents per share, down from $1.15 billion, or 97 cents per share, a year earlier.

• Net sales rose 9% to $8.15 billion.

• The coffee giant reported global same-store sales growth of 3%, fueled by a strong performance in the United States.

• In Starbucks’ home market, same-store sales increased 9%, driven largely by higher average order totals.

• Traffic also ticked up 1%, a rarity in the restaurant industry as other chains see low-income consumers visiting less often.

• Outside the U.S., same-store sales fell 18%, weighed down by plummeting demand in China. The country, which is Starbucks’ second-largest market, spent two-thirds of the quarter under restrictions to curb the spread of Covid.

• China’s same-store sales plunged 44%, ” driven by a 43% decline in transactions with COVID restrictions holding back traffic in key cities.” The company is still seeing periodic short-term closures in China.

• Last quarter, Starbucks pulled its outlook for fiscal 2022, citing the uncertainty caused by Covid outbreaks in China. The company did not issue a new forecast this quarter.

• Starbucks opened 318 net new locations worldwide during the quarter, bringing its global restaurant count to 34,948.

• Active membership in Starbucks Rewards in the U.S. rose 13% to 27.4M during the quarter.

• The operating margin fell to 22.0% of sales from 24.3% a year ago.