Starbucks (SBUX) Q1 2016 Earnings Call

posted in: Earnings Call, Notes | 0

 

Starbucks (SBUX) CEO Howard Schulz said the decline of traditional brick and motor retail isn’t slowing the company’s brand or success down
“Our recent classes of new and remodeled retail stores continue to defy established consumer trends away from traditional bricks-and-mortar retailing and deliver record-breaking unit sales, unit economics and return on investment; very strong performance metrics that underscore the increasing power and relevance of the Starbucks brand around the world.”
 
Still opening a massive amount of new stores in China
 
Starbucks has committed to China, and we now have over 2,000 stores in 100 cities in China and are adding over 10 new stores every week. Our business in China remains very strong, and I personally have no doubt that the Chinese government’s commitment to true economic reform is genuine and that its plan to double 2010 per capita income by 2021, resulting in a middle-class in China approaching 600 million people, almost twice the size of the entire current U.S. population, is achievable.”
 
Starbucks (SBUX) COO Kevin Johnson said a substantial percentage of their customers are paying for their orders with their phone
 
And we now have almost 19 million users of our mobile app in the U.S. alone. Mobile payment represented 24% of total U.S. tender in Q2, and Mobile Order & Pay continues to be increasingly embraced by our customers. It adds incrementality, especially at peak. Mobile Order & Pay transactions represented approximately 4% of total transactions in the quarter, which was a 40% increase sequentially.”