Starbucks rallies after conference call confidence swings sentiment
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Starbucks Corporation (NASDAQ:SBUX) rallies after the coffee chain's conference call and analyst commentary helped take the sting off the slowdown in China and pulled guidance for FQ3 and FQ4.
CEO Howard Schultz talked up the Starbucks Web 3.0 strategy and pointed to record demand in the U.S. during the earnings call.
"Looking ahead, trying to imagine thousands of vastly more productive and efficient Starbucks stores reconfigured to align with today's customer behavior and built around technology that will deliver increased speed of service, improved labor management and reduced unit cost, an elevated partner and customer experience," updated CEO Howard Schultz.
He also reiterated that stores with union will not have the same level of improvements and employee benefits as stores without a union.
Starbucks (SBUX) plans to set financial targets and update on capital allocation plans at an Investor Day event in September.
Analysts were cautiously optimistic about the balance of the SBUX, while staying generally bullish on the longer term track.
"We remain confident in the long term story given the strength of the U.S. sales playbook and long term development opportunity in China given strengthened new unit economics prior to the recent COVID-19 wave. However, we expect shares to remain subdued in the near term as the company paves the way for a new CEO hire later in 2022 & investors can gain more confidence in 2023-24," commented Cowen analyst Andrew Charles.
Shares of Starbucks rose 6.01% premarket to $78.80 after initially turning negative when the earnings report dropped.
Dig into the Starbucks earnings call transcript