Starbucks’ Earnings Deliver Impressive 18% Growth in 2Q15

Starbucks' 2Q15 Earnings: Key News for Investors (Part 1 of 5)

Earnings per share

Starbucks (SBUX) released its 2Q15 earnings on April 23 after the market closed. The company reported adjusted EPS (earnings per share) of $0.33—an increase of 17.9% compared to an adjusted EPS of $0.28 in the same quarter last year.

The company reported revenue of $4.5 billion—a 17.8% increase from $3.8 billion in the same quarter last year. For the quarter, the net income was $494 million. We’ll discuss the financial performance in more detail later in this series.

Starbucks competes with other famous brands like Dunkin’ Brands (DNKN) and Tim Hortons. Recently, Dunkin’ Brands launched its dark roast coffee. Tim Hortons was acquired by Burger King (QSR). Starbucks also faces competition from McDonald’s (MCD) and Taco Bell—under the umbrella of Yum! Brands (YUM). Both of these companies entered the morning daypart— serving coffee and breakfast items. McDonald’s, Starbucks, and Yum! Brands are part of the C onsumer Discretionary Sector ETF (XLY). XLY holds about 10% of the restaurant stocks.

Company overview

Starbucks was formed in 1985. It sells handcrafted coffees, other beverages, and food items at its company-operated stores. Starbucks also sells its products through grocery and licensed stores. Along with its branded products, Starbucks sells items under brands like Tazo, Starbucks VIA, Teavana, Evolution Fresh, Seattle’s Best Coffee, Verismo, and La Boulange. In the quarter ending March 29, Starbucks had more than 21,800 restaurants in the system.

Series overview

In this overview of Starbucks’ 1Q15 earnings, we’ll take a deeper look at the earnings and strategic changes or tactics that Starbucks’ management discussed during the earnings call. We’ll also discuss key value metrics like same-store sales growth and unit growth, and how the market reacted to the earnings. This will help you understand the company and make an investment decision.

Continue to Part 2

Browse this series on Market Realist:

• Part 2 - Starbucks’ Worldwide Same-Store Sales Growth Remains Strong

• Part 3 - Starbucks Focuses on Unit Growth to Increase Its Sales

• Part 4 - Analyzing Starbucks’ Management Initiatives in 2Q15