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Starbucks is about to report earnings. Here's what to expect

By · Published by Everything Blog

In short

The coffee retailer prepares to disclose its quarterly performance on Thursday following an extensive corporate reorganization. The company's U.S. turnaround plan involves closing about 250 North American cafes, representing roughly 1% of its regional footprint, to help bolster same-store sales numbers. These store closures will result in approximately $300 million in restructuring charges. Meanwhile, strong investor sentiment has already pushed the company's shares up around 24% throughout this year.

Key points

  • If projections hold, the company will secure its fifth consecutive quarter of same-store…: If projections hold, the company will secure its fifth consecutive quarter of same-store sales growth.
  • Restructuring charges tied to the North American store closures are expected to reach aro…: Restructuring charges tied to the North American store closures are expected to reach around $300 million.
  • Strong share performance this year has elevated the coffee chain's overall market capital…: Strong share performance this year has elevated the coffee chain's overall market capitalization to roughly $119 billion.

Sources checked by our analysis pipeline: 1

Starbucks is set to report its quarterly earnings after the bell on Thursday.

Here's what Wall Street is expecting the company to report, based on a survey of analysts by LSEG:

- Earnings per share: 72 cents expected

- Revenue: $9.23 billion expected

Wall Street is also projecting that the coffee giant will report its fifth straight quarter of same-store sales growth, as its U.S. turnaround takes hold. Analysts expect Starbucks to post a same-store sales increase of 6%, fueled by its North American cafes, according to StreetAccount estimates.

As its U.S. business improves, Starbucks is closing underperforming locations, which could boost same-store sales numbers. In September, the company announced it would shutter about 1% of its North American footprint, representing about 250 cafes. The company expects to incur about $300 million in restructuring charges related to the closures.

The company's earnings report also comes weeks after Starbucks quashed speculation that it will buy Chipotle Mexican Grill, CEO Brian Niccol's former employer. While Chipotle investors cheered for the rumored acquisition, industry analysts said that a merger would distract Starbucks from…

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