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July 24 Starbucks Corp on Thursday said quarterly sales at established stores in its dominant Americas region grew a somewhat stronger-than-expected 6 percent, including a 7 percent rise for the United States that was helped by food sales.
The third fiscal quarter report from the world's biggest coffee chain followed disappointing quarterly results from McDonald's Corp and Dunkin' Donuts parent Dunkin' Brands .
But Starbucks' sales gains did not rival those from Chipotle Mexican Grill Inc. The burrito chain, which has a lot of customer overlap with Starbucks, on Monday posted an eye-popping 17.3 percent rise in same-restaurant sales and its stock soared to all-time highs.
Shares in Starbucks were down 2.4 percent to $78.50 in extended trading following its results. Chipotle and Starbucks are two of the top-performing U.S. restaurant chains and their shares can be punished by investors when results do not far exceed expectations.
Seattle-based Starbucks' net income was $512.6 million, or 67 cents per share, for the fiscal third quarter that ended June 29. That was up from $417.8 million, or 55 cents, a year earlier.
Results from the latest quarter topped analysts' average estimate by a penny, according to Thomson Reuters I/B/E/S.
Revenue grew 11 percent to $4.15 billion, boosted in part by the roll-out of new breakfast sandwiches and pastries from its La Boulange bakery.
Analysts, on average, expected Starbucks quarterly same-store sales to rise 5.1 percent globally and for the Americas region, according to Consensus Metrix.
Starbucks raised U.S. prices by roughly 1 percent near the end of the quarter, due to higher costs for things like coffee and milk.
Few restaurant operators are willing to take that risk given still-weak overall demand. Indeed, high meat prices recently forced McDonald's to push through some price increases and its traffic has taken a hit.
Starbucks said U.S. traffic was up 2 percent in the latest quarter, when customers spent 5 percent more per visit.
Troy Alstead, Starbucks' chief operating officer, told Reuters in an interview that Starbucks had not noticed any customer push-back on its price increase.
Chipotle customers shrugged off a price increase in the latest quarter. In fact, more people flocked to the popular chain that sells food made with organic produce and antiobiotic-free meat.
(Reporting by Lisa Baertlein in Los Angeles; Editing by Phil Berlowitz and Cynthia Osterman)