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Starbucks CEO Talks Store Traffic, Growth Drivers, Chinese Consumers

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Starbucks CEO Talks Store Traffic, Growth Drivers, Chinese Consumers

Starbucks (NASDAQ: SBUX) reported fourth-quarter earnings per share of 51 cents Thursday, beating analyst expectations of 31 cents, and fourth-quarter sales of $6.2 billion that beat the Street estimate of $6.04 billion.

Starbucks CEO Kevin Johnson appeared on CNBC’s “Squawk on the Street” and discussed store traffic, growth and Chinese consumers.

Johnson On Starbucks Traffic: “We were at negative 65% same store comparable sales in April; four months later, we’re at negative 4%,” the Starbucks CEO said. 

Store traffic is down in central business districts and up in the suburbs, he said. 

Starbucks is repositioning central business district stores to a pickup format, Johnson said, adding that this will take place over the next 12 months.

Starbucks has opened over 60% of their stores for limited seating, and customers are coming back, the CEO said. 

Johnson On Starbucks Growth: Starbucks' growth is primarily driven by group orders; is still driven by beverages; and food attaches are at an all-time high, Johnson told CNBC. 

Johnson On China: Starbucks is bullish on its business in China, Johnson said.

Stores have full seating, and there are very few COVID-19 cases in the country, he said. 

"The Chinese consumer is the most digitally oriented consumer in the world." 

Starbucks established partnerships with WeChat, Alibaba (NYSE: BABA) and Tencent over the last quarter, the CEO said. 

SBUX Price Action: Starbucks shares were down 1.49% at $86.98 at last check Friday. 

 

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