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Starbucks Beats Earnings Forecasts, Boosts 2021 Outlook As U.S. Sales Soar

"As evidenced in our Q3 record results, we are raising our full-year financial outlook and are confident in our ability to continue to execute our ‘Growth at Scale’ agenda," said CEO Kevin Johnson.

Starbucks  (SBUX) - Get Starbucks Corporation Report posted better-than-expected third quarter earnings Tuesday, and boosted its fiscal-year profit guidance, as customers returned to stores in key markets as economies emerged from pandemic-triggered lockdowns. 

Starbucks said non-GAAP earnings for the three months ending in June, the group's fiscal third quarter, were pegged at $1.01 per share, firmly ahead of the Street consensus forecast of 77 cents per share and last year's third quarter loss of 46 cents per share.

Group revenues, Starbucks said, rose 78% to $7.5 billion, again topping analysts' estimates of a $7.28 billion. U.S. comparable sales surged 83% from last year as shops re-opened, while comps in China were up 19%. International comparable sales rose 41%, Starbucks said.

Looking into the final months of the year, Starbucks said it sees non-GAAP earnings in the region of $3.20 to $3.25 per share for fiscal 2021, with revenues rising to between $29.1 billion and $29.3 billion. 

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“Starbucks delivered record performance in the third quarter, demonstrating powerful momentum beyond recovery. Our ability to move with speed and agility and to be out in front of shifting customer behaviors has helped further differentiate Starbucks, positioning us well for this moment,” said Kevin Johnson.

“As the Great Human Reconnection continues to unfold, our partners are rising to the occasion, ready to meet our customers wherever they need us to be – with the right store, in the right place, at the right time. Given the strength of our diverse portfolio and the elevated Starbucks Experience, as evidenced in our Q3 record results, we are raising our full-year financial outlook and are confident in our ability to continue to execute our ‘Growth at Scale’ agenda to unlock the full potential of the Starbucks brand," he added. 

Starbucks shares were marked 3.05% lower in extended-hours trading immediately following the earnings release to indicate a Wednesday opening bell price of $122.19 each.

North American comparable sales are forecast to rise by as much as 22% for the full fiscal year, Starbucks said, with a global rate of between 18% and 21%. China sales are forecast to grow by between 18% and 20%.

Costs remain a key concern for Starbucks over the near term, however, as Arabic coffee prices surged to their highest levels in nearly seven years his week thanks in part to an unseasonably cold winter in Brazil, where government estimates suggest as much as 11% of the nation's arabica crop area has been affected.