Coffeehouse Giant Starbucks' Brew-tiful Q4 Earnings, Stock High On Caffeine-Infused Joy

Starbucks Corp SBUX reported fourth-quarter FY23 sales growth of 11.4% year-on-year to $9.37 billion, beating the analyst consensus estimate of $9.29 billion.

Comparable store sales for Q4 increased 8% globally, grew 8% in North America, and climbed 5% internationally.

Revenue in North America rose 12.5% to $6.9 billion, and International revenue increased 11.4% to $1.98 billion.

Adjusted EPS of $1.06 beat the consensus estimate of $0.97.

Operating expenses climbed 6.5% Y/Y to $7.8 billion. Operating margin for the quarter contracted 400 basis points to 18.2%, and the operating income jumped 42.7% to $1.706 billion.

The company opened 816 net new stores in Q4, ending the period with 38,038 stores: 52% company-operated and 48% licensed.

At the end of Q4, stores in the U.S. and China comprised 61% of the company's global portfolio, with 16,352 and 6,806 stores in the U.S. and China, respectively.

The company held $3.95 billion in cash and equivalents as of October 1, 2023. Operating cash flow for the year totaled $6 billion.

"Our Reinvention is moving ahead of schedule, fueling revenue growth, efficiency and margin expansion," said CEO Laxman Narasimhan.

The company's cash dividend of $0.57 per share is payable on November 24, 2023, to shareholders of record on November 10, 2023.

Rachel Ruggeri, CFO, said, "We are proud that our full fiscal year 2024 guidance will be grounded on a balance of both revenue growth and margin expansion."

Outlook: Starbucks sees FY24 revenue growth at the lower end of 10% - 12% forecast. SBUX continues to see FY24 adjusted EPS growth to be 15% - 20%. It expects global comparable sales growth to be 5% - 7%.

Price Action: SBUX shares are trading higher by 10.08% at $100.56 premarket on the last check Thursday.