Starbucks’ Worldwide Same-Store Sales Growth Remains Strong
Starbucks' 2Q15 Earnings: Key News for Investors (Part 2 of 5)
Same-store sales growth
Starbucks (SBUX) reported same-store sales growth of 7% for its company-owned stores, opened for 13 months or longer, around the world. Same-store sales growth is one of the important drivers of the restaurant industry. It directly drives the revenue. It measures the percentage change in revenue generated by existing restaurant locations over the similar period the year before.
Same-store sales by segments
Starbucks reported same-store sales for its three segments—the Americas, China and Asia-Pacific, and EMEA (Europe, Middle East and Africa). Looking at the above graph, the same-store sales didn’t change in the Americas segment. The worldwide same-store sales remained at 6% levels in the past 12 months. Yum! Brands (YUM) and McDonald’s (MCD) both have a presence in all of the regions mentioned above.
The Americas segment
The Americas segment includes the US, Canada, and Latin America—Brazil and Puerto Rico. Together, these countries account for about 70% of Starbucks’ revenue. The same-store sales growth was 6%. It didn’t change from the same period in 2014.
The EMEA segment
The EMEA segment accounts for about 7% of Starbucks’ revenue. The same-store sales growth declined to 3% during the quarter from 6% in the same quarter in 2014.
The China and Asia-Pacific segment
The China or Asia-Pacific segment includes China, Thailand, Singapore, and Australia. The segment accounted for about 9% of Starbucks’ revenue. In this segment, the same-store sales growth increased the most to 12% during the quarter from 7% in the same quarter in 2014.
Same-store sales is an important valuation metric for the restaurant industry. The industry is part of the Consumer Discretionary Sector (XLY). XLY holds 10% of restaurant stocks including restaurants like Darden Restaurants (DRI) and Chipotle Mexican Grill (CMG).
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