Starbucks (NASDAQ: SBUX) reported Q3 EPS of ($0.46), $0.13 better than the analyst estimate of ($0.59). Revenue for the quarter came in at $4.2 billion versus the consensus estimate of $4.06 billion.

Global comparable store sales declined 40%, driven by a 51% decrease in comparable transactions, partially offset by a 23% increase in average ticket

• Americas comparable store sales declined 41%, driven by a 53% decrease in comparable transactions, partially offset by a 27% increase in average ticket; U.S. comparable store sales were down 40%, with comparable transactions down 52%, partially offset by a 25% increase in average ticket
• International comparable store sales were down 37%, driven by a 44% decline in comparable transactions, slightly offset by a 13% increase in average ticket; China comparable store sales were down 19%, with comparable transactions down 27%, slightly offset by a 10% increase in average ticket; International and China comparable store sales are inclusive of a benefit from value-added tax exemptions of approximately 2% and 4%, respectively

GUIDANCE:

Starbucks sees Q4 2020 EPS of $0.18-$0.33, versus the consensus of $0.27.

• Global comparable store sales declines of 12% to 17% for each of Q4 and full year
• • Americas and U.S. comparable store sales declines of 12% to 17% for each of Q4 and full year
• ▪ (previously declines of 10% to 20% for each of Q4 and full year)
• • International comparable store sales declines of 10% to 15% for Q4 and 20% to 25% for full year inclusive of a benefit from value-added tax exemption of approximately 3% and 1%, respectively
• ▪ (previously declines of 10% to 20% for Q4 and 20% to 30% for full year)
• ◦ China comparable store sales roughly flat to -5% for Q4 and a decline of 15% to 20% for full year, inclusive of a benefit from value-added tax exemption of approximately 4% and 2%, respectively
• ▪ (previously roughly flat by the end of Q4 and a decline of 10% to 20% for full year)
• • Americas approximately 300 net new stores
• • China at least 500 net new stores
• • Consolidated revenue decline of 10% to 15% for Q4
• ◦ Channel Development revenue decline of 5% to 6% for full year
• • Interest expense of approximately $435 million to $445 million
• • GAAP and non-GAAP effective tax rates in the range of mid- to high-20%s
• • GAAP EPS in the range of $0.06 to $0.21 for Q4 and $0.50 to $0.65 for full year
• ▪ (previously $0.11 to $0.36 for Q4 and $0.33 to $0.73 for full year)
• ◦ Non-GAAP EPS in the range of $0.18 to $0.33 for Q4 and $0.83 to $0.98 for full year
• ▪ (previously $0.15 to $0.40 for Q4 and $0.55 to $0.95 for full year)
• • Capital expenditures of approximately $1.5 billion
• All guidance for the metrics noted above is for Q4 FY20 and fiscal year 2020, and growth metrics are relative to Q4 FY19 and fiscal year 2019. Please note, the guidance provided above is dependent on our current expectations which may be impacted by evolving, external conditions and local safety guidelines.

For earnings history and earnings-related data on Starbucks (SBUX) click here.