Yahoo Finance How Starbucks’s Segments Contributed to Its 3Q15 Growth
Starbucks Continues to Deliver Impressive Results in 3Q15
Starbucks’ segments: Americas
Starbucks’s (SBUX) Americas segment contributes about 70% of the company’s operating income, making it the company’s most important segment. The Americas segment has the largest Starbucks store footprint. This segment has added units at an annual rate of 5%. But it has less unit growth opportunities compared to the CAP (China, Asia-Pacific) segment, which has a unit growth rate of 15% annually. That being said, increasing comps (comparable same-store sales) is the Americas segment’s principal strategy.
Comps in the Americas segment grew 8% with a growth of 4% in traffic and the remaining 4% in ticket, as you can see in the chart above. This increase in comps has translated into 12% revenue growth year-over-year in the Americas segment. The company’s mobile strategy has proven incrementally positive in driving much of the Americas business. We’ll discuss this more in the next part of this series.
Domino’s (DPZ) has also seen huge benefits from implementing a strong tech strategy while companies like McDonald’s (MDC) and Yum! Brands (YUM) are lagging. Together MCD, YUM, and Chipotle (CMG) make up to about 5.5% of the Consumer Discretionary Select Sector SPDR (XLY).
CAP segment
The China/Asia Pacific region contributes about 12% to Starbucks’s operating income. This segment is the fastest-growing segment for the company, with 3Q15 comps coming in at 11%, which grew from 7% in the corresponding quarter a year ago in 2014. According to management, most of this growth came from traffic.
EMEA segment
The EMEA (Europe, Middle East, and Africa) segment contributes about 11% to Starbucks’s operating income and comps in this region grew 3%, with a 2% increase coming from traffic and the remainder coming from ticket. The company plans to open 150 new stores in South Africa, with the first store opening in Johannesburg in 2016.
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