News Column

Starbucks Stays Hot Despite Harsh Winter

April 25, 2014

Bruce Horovitz, USA TODAY

Starbucks CEO Howard Schultz (USA Today)
Starbucks CEO Howard Schultz (USA Today)

While much of the fast-food industry complains about how hard restaurants were hit by the lousy winter weather, Starbucks -- which posted record quarterly results on Thursday -- is lovin' it.

The world's biggest coffee chain said that sales at stores open a year or more rose a record 6% globally for its fiscal second quarter and 6% in the U.S, too. The company said it earned $427 million, or 56 cents a share.

The company reported after the bell, and its shares were up about 1.4% to $72.10 in after-hours trading on Thursday.

"Starbucks' record operating performance in Q2 demonstrates that our focus on building a different kind of company continues to drive profits and shareholder value," said CEO Howard Schultz, in a statement.

Even as Starbucks seemed to brush away winter woes, Dunkin' Donuts complained about them on Tuesday. CEO Nigel Travis said that comp store sales growth in the U.S. was "significantly impacted" by severe weather in regions where most of its Dunkin' Donuts restaurants are located.

But even in lousy weather, Starbucks seemed to remain something of a beacon for folks looking for a place to warm up -- and drink up. Earlier in the quarter, the company announced a revamp of its Teavana tea business. That included an unusual partnership with Oprah Winfrey -- who even got a tea named after her. Also, last month Starbucks and Keurig Green Mountain updated their agreement under which Starbucks now will expand its range of K Cup offerings.

Starbucks also continued to push breakfast in the U.S., even as Taco Bell rolled out a breakfast menu and McDonald's responded with free coffee. Meanwhile, Starbucks continued to amass new locations. In the quarter, it opened a net 335 stores globally to pass 20,000 total.

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Original headline: Winter didn't hurt profit at Starbucks


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