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Shares in the Seattle-based company rose about 3% in after-market trading, as Starbucks (NASDAQ:SBUX) also posted a smaller-than-feared decline in sales in China – its fastest growing market.
While restaurants such as McDonald’s Corp (NYSE:MCD) and Yum Brands Inc have drawn inflation-hit Americans with cheaper meals, higher priced Starbucks coffee and cold beverages have enjoyed a steady stream of higher-income customers.
The company’s U.S. comparable sales rose 11% in the quarter, also boosted by the return of its iconic Pumpkin Spice Latte – which, according to Credit Suisse analysts, contributed to the highest sales week in Starbucks’ history.
The jump helped Starbucks cushion the hit from a 16% decline in comparable sales in China, where it is still reeling under a zero-COVID policy that has forced its seating areas shut and kept customers away.
Wall Street analysts expected Starbucks’ comparable sales in China to drop by 20%, according to analysts at Gordon Haskett. The company had reported a 44% slump in the previous quarter.
“We saw accelerating demand for Starbucks coffee around the world in Q4 and throughout the year,” said interim Chief Executive Officer Howard Schultz.
Global comparable sales at Starbucks rose 7% in the fourth quarter ended Oct. 2, while analysts on average had expected a 4.2% rise, according to Refinitiv IBES.
Total net revenue rose to $8.41 billion from $8.15 billion a year earlier, compared with analysts’ average estimate of $8.31 billion.
