SBUX 3Q26 First Take: In the fourth quarter of its transformation, the company finally translated top-line momentum into earnings power. Comps, margins, and EPS all beat, and full-year guidance was raised.
1) Overall: reported revenue edged down, but underlying ops accelerated. In 3Q26, SBUX posted revenue of $9.32bn (-1.4% YoY; cons. $9.12bn), with the decline entirely from China deconsolidation as revenue recognition shifted from company-operated to royalties and product sales only.
Excluding this reporting change, operations clearly accelerated: global comps jumped 7.9%, well above the 5.4%–5.7% range, with traffic +4.2% and ticket +3.5%.
Non-GAAP EPS was $0.85, up 70% YoY.2) North America: ticket took the baton from traffic. North America revenue reached $7.40bn (+7% YoY), lifting mix to 79% of total.
Comps rose 8.1%, with traffic +4.4% (roughly flat), while the real acceleration came from ticket, up from +2.6% to +3.5%, driven by delivery, food attach, and beverage mix upgrades; list pricing contributed little.
Operational tailwinds from store relocations and longer hours appear to have plateaued.
The store base continued to contract, ending at 18,371 with net closures of 14.3) Intl: revenue halved but comps beat. Intl revenue was $1.32bn (-34% YoY), fully due to China deconsolidation (company-operated -50%, licensed +21%).
Comps rose 5.7% (vs. 4.1% est.), mainly because China’s lower-price market, which had dragged ticket, was excluded from the comps base.4) Profitability continued to repair: on one hand, Smart Queue and new equipment reduced order backlogs and improved peak throughput. On the other, China formally shifted to an asset-light JV model, taking the G&A ratio down from 7.2% to 6.4%.
Non-GAAP OPM reached 14.4%, up 430bps YoY (vs. 12% est.).
Guidance: 4Q US comps set at 6.5%+. Full-year US comps 'slightly above 6.0%' and global 'near 6.0%' (prior: 5%+).
The company also introduced a Non-GAAP OPM target 'above 11.0%'. For more details, stay tuned for Dolphin Research’s detailed take and call Trans. $Starbucks(SBUX.US)
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