An overview of Starbucks’ 4Q14 earnings



Earnings per share

Fourth-quarter earnings for Starbucks Corporation (SBUX) were released on October 30, 2014. The company reported adjusted earnings per share (or EPS) of $0.74, an increase of 23%, compared to an adjusted EPS of $0.60 in the same quarter last year.

The company reported revenues of $4.1 billion, a 10% increase from $3.8 billion in the same quarter last year. Net income for the quarter was $587 million, which gave the company a net profit margin of 14%. We’ll discuss financial performance in more detail later.

SBUX Adjusted Earnings Per Share 2014-11-03

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Starbucks competes with other famous brands such as Dunkin’ Brands (DNKN) and Tim Hortons (THI). Dunkin’ Brands reported an EPS of $0.52, up 40%, compared to an EPS of $0.37 in the same quarter last year. Tim Hortons reported an EPS of $0.68, down 6% from $0.72. Starbucks also faces competition from McDonald’s (MCD), who has entered the breakfast segment by serving coffee and breakfast items. McDonald’s reported an EPS of $1.09, down 28%, compared to an EPS of $1.52 in the same quarter last year.

Investors who would like to invest in the restaurant industry as a whole can invest in exchange-traded funds (or ETFs) like the Consumer Discretionary Select Sector Standard & Poors depositary receipt (or SPDR) fund (XLY).

Company overview

Starbucks Corporation (SBUX) 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 such as Tazo, Starbucks VIA, Teavana, Evolution Fresh, Seattle’s Best Coffee, Verismo, and La Boulange. In the quarter ending September 2014, Starbucks had 10,713 company-operated restaurants and 10,653 licensed stores.

Series overview

In this overview of Starbucks’ 4Q14 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 such as same-store sales, the impact of costs, how the market reacted to the earnings, and Starbucks’ year-to-date stock performance. This will help you understand the company and make an investment decision.


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