Starbucks' profit climbs as customers spend more

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NEW YORK — Starbucks says its profit rose 34 percent in the quarter, as the coffee chain used its loyalty program to get customers to visit more often and spend more on revamped sandwiches and other food.

The Seattle-based company said global sales rose 7 percent at cafes open at least a year, including an 8 percent rise in both the U.S. and Asia. In the region encompassing Europe, the Middle East and Africa, where the company has struggled, the figure rose 2 percent.

The sales performance is somewhat of a standout in the restaurant industry. Chains including McDonald’s and Burger King have blamed the weak economy as they fight to drive up sales. But others are faring relatively better, with Chipotle reporting a 6.2 percent sales increase at stores open at least a year and Dunkin’ Donuts reporting a 4.2 percent increase for the latest quarter.

Starbucks Corp. has managed to keep growing through a mix of measures. It’s adding items such as Evolution juices, which can cost as much as $6 a bottle, and has rolled out new sandwiches and salads to get people to spend more when they stop in for a drink. Prices on several beverages were also hiked over the summer.

Troy Alstead, Starbucks’ chief financial officer, said the increase in the average receipt for the quarter was mostly because of food. “As they’re adding those purchases, that’s giving us a lift,” he said.

Still, Alstead said only about a third of purchases overall include food. But he said the trends are improving, and should continue to do so as the company finishes the rollout of new La Boulange baked goods.

The company has also been benefiting from lower costs for coffee beans.

For the quarter, Starbucks said it earned $481.1 million, or 63 cents per share. A year ago, the company earned $359 million, or 46 cents per share.

Revenue rose to $3.8 billion.

Starbucks has about 20,000 locations around the world, with about 12,000 of those in the U.S.


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