It seems we've become a Starbucks
Starbucks has continually delivered increasing earnings to investors, but this time, the holiday season looked merrier than ever. Jeff Fischer recently pointed out that the company's had ongoing success living up to what many saw as too-high valuations, and LouAnn Lofton predicted that this would be a robust first quarter due to some of its growth strategies.
The gift card that had such a high profile over the last holiday season was a popular item for the coffee purveyor, and the company's still ringing in the benefits in January as recipients continue to guzzle down those lattes and espressos through the plastic. Holiday promotions and seasonal drinks also added to the coffee maker's success. (Don't forget the odd story of the Seattle restaurant launching Starbucks coffee-flavored steak -- just another sign of the appeal of the substance.)
If you're wondering just how much of a jolt of java we're talking about here, Starbucks' first-quarter earnings rocketed 41% higher. It reported net income of $110.8 million for the quarter or $0.27 per share, compared to $78.4 million or $0.20 a share in the year-ago period. Same-store sales were 10% higher. The company said it expects its year's earnings to come in on the high side of earlier guidance, at $0.86 to $0.87 a share.
Coffee breaks at Starbucks seem to have become a national pastime; news agencies report that the company's CEO has found that the chain is attracting a much more diverse demographic than the firm had originally anticipated. Meanwhile, a recent store opening in West Virginia means Starbucks has its foot in all 50 states.
As far as taking over the world is concerned, its international operations are expected to travel their way to profitability this year. Its move into Paris had many people abuzz, and while the company did not want to specify what its next international move will be, it mentioned possible growth opportunities in the Middle East and China.
With Starbucks' continued growth, an increasingly ubiquitous presence, and a firm grip on our caffeine cravings, it doesn't sound even close to investors finally saying "when."
Will Starbucks ever stop? Take a break on the Starbucks discussion board and talk it over with other Fools.
Alyce Lomax does not own shares of Starbucks, though a grande latte's sounding pretty darn good right about now. She welcomes your feedback via email.