NEW YORK (TheStreet) -- Starbucks (SBUX) posted in-line fiscal second-quarter earnings on Thursday, helped by lower coffee costs, but revenue fell short of Wall Street's estimates. Still the coffee chain bumped its EPS guidance for fiscal 2014.
The Seattle-based company said quarterly net income attributable to Starbucks rose 9.4% to $427 million, or 56 cents a share, for the March 30-ending quarter. That number excluded a 3-cent non-routine gain in 2013 related to the sale of the company's equity in its Mexico joint venture. Starbucks had guided in its first-quarter earnings for the second quarter EPS to be in the range of 54 to 55 cents a share. Analysts, according to Thomson Reuters, expected the company to report earnings of 56 cents a share, up 9% from last year.
However, revenue fell short of expectations. Starbucks posted revenue of $3.87 billion, up 9% from the year-earlier quarter compared to estimates of $3.96 billion. Operating margin for all of Starbucks reporting segments rose 130 basis points to a second-quarter record of 16.6% vs. 15.3% in last year's quarter, "primarily driven by lower commodity costs and sales leverage," the company said.
That said, Starbucks same-store sales comps exceeded analysts' expectations. Starbucks as a whole saw comps rise 6% in the quarter, compared to consensus expectations of 5.4% by Consensus Metrix. Comps in the Americas also rose 6% in the quarter compared to an expectation for 5.4%. In emerging markets comps also rose 6% compared to a 4.5% estimate. The only geographic area where comps fell short of expectations was in China and Asia Pacific. Analysts were expecting comps of 8.4% but actual comps came in at 7%.