Starbucks announces Nespresso pod deal, new loyalty perks

SEATTLE/LOS ANGELES - Starbucks Corp. said on Wednesday it will sell espresso pods for Nestle SA's popular Nespresso home brewers in Europe and unveil a new way for customers to earn loyalty points for free food and drinks outside its cafes.

Nespresso is the most popular single-cup brewer in Europe, and Starbucks' espresso deal marks the company's debut on that machine.

Starbucks also said Keurig Green Mountain, which was purchased by an investor group led by Germany's Joh. A. Benckiser Holding Co (JAB) in March, will continue to supply Starbucks K-cups for Keurig brewers. The company this summer will begin selling latte products for Keurig machines in the United States, where that brewer dominates.

Starbucks, which is hosting its annual meeting in Seattle, also said it would begin selling bottled cold-brew coffee in the United States this summer and Teavana tea brand products in Asia and Europe by this autumn.

The company, which recently changed its loyalty program so that users earn redeemable points based on dollars spent rather than single transactions, said it would roll out a prepaid rewards card from Visa before the end of 2016. That card will allow customers to earn loyalty points on purchases outside its stores.

Shares in Starbucks closed down 0.6 percent at $58.83 on the Nasdaq.

source: www.abs-cbnnews.com

Starbucks says aims to open 500 new stores in China in 2016

HONG KONG - Starbucks Corp., the world's largest coffee chain, said on Tuesday it aims to open 500 stores in China this year, shrugging off a slowdown in the world's second-largest economy that has hit global retailers.

Starbucks executives have said they have not seen a systemic slowdown in China, even as the country's cooling economy has been blamed for soft results by the likes of KFC and Pizza Hut parent Yum Brands.

The company said in a statement it aims to create 10,000 jobs in China every year through 2019 as it continues to expand in its largest market outside the United States.

source: www.abs-cbnnews.com

Starbucks cafe sales hot, but holiday forecast disappoints

Starbucks Corp. delivered a disappointing profit forecast for the holiday quarter on the heels of strong cafe sales and profit growth, sending its shares lower.

Starbucks' Americas division and its Europe, Middle East and Africa unit last quarter turned in surprisingly strong sales at established restaurants. But its up-and-coming Asia region fell short during an economic cool-down in China that has roiled global stock markets.

The world's biggest coffee chain said on Thursday its holiday quarter that began Sept. 28 would be dented by the effect of the strong U.S. dollar.

The company, known for starting its fiscal years with conservative estimates, also issued a 2016 forecast with little upside for investors who are grappling with concerns that shares of the Seattle-based chain are too hot after rallying more than 60 percent over the past year.

Starbucks shares fell as much as 3 percent in after-hours trading, before settling at $62, down 0.8 percent.

Global sales at cafes open at least 13 months rose 8 percent in the fiscal fourth quarter, beating the 6.9 percent rise expected by analysts polled by research firm Consensus Metrix.

China's cooling economy has global investors on edge and already has been blamed for soft results from KFC and Pizza Hut parent Yum Brands Inc.

Starbucks executives said they have not seen a systemic slowdown in China, noting that comparable sales continued to accelerate into October.

The company declined to break out same-store sales for China, home to 1,800 Starbucks cafes, or about 8 percent of the company's total. Starbucks, which expects China to one day be its largest market outside the United States, said it would have 3,400 cafes there by 2019.

PAY HIKES, TECH HELP

Chief Executive Howard Schultz attributed the better-than-expected fourth-quarter cafe sales growth to several new initiatives at the chain, which recently improved its food and is rolling out new drinks such as the Toasted Graham Latte.

Among other things, Schultz said U.S. cafe service improved and turnover fell after Starbucks raised pay and improved benefits for cafe workers. The company added new delivery services and introduced mobile technology that allows customers to skip lines by ordering and paying for their drinks via mobile devices.

"Starbucks is playing the long game," Schultz said on a call with analysts.

Fourth-quarter net income jumped 11 percent to $652.5 million, or 43 cents per share, matching analysts' average target according to Thomson Reuters I/B/E/S.

Starbucks estimated first-quarter earnings of 44 cents to 45 cents, excluding items. Analysts on average had a target of 47 cents for the quarter, the company's biggest for revenue, according to Thomson Reuters I/B/E/S.

The company forecast fiscal 2016 earnings, excluding items, of $1.87 to $1.89 per share, in line with analysts' average call for $1.88 per share.

source: www.abs-cbnnews.com