Starbucks has reported revenues up 12% to a record $36bn (£30bn) and net earnings of $4bn (£3.3bn) for the year ended 1 October 2023. 

In its international business, Starbucks reported “record store growth” of nearly 600 stores, with the international store count remaining higher than that of the U.S.

There was double-digit revenue growth in the quarter, with continued growth across every key market around the world.

“Our comparable same-store sales in our company-operated markets for both the U.K. and Japan remained well above historical averages in fiscal year 2023, with growth attributed to higher profitability and higher productivity store formats, as well as elevated digital and partner experiences,” CEO Laxman Narasimhan said.

Global comparable store sales increased 8%, driven by a 5% increase in average ticket and 3% increase in comparable transactions. International comparable store sales increased 5%, driven by a 5% increase in comparable transactions.

Speaking on an earnings call yesterday, Narasimhan and CFO Rachel Ruggeri said both volumes and spend are driving growth.

“We have a record number of customers coming into stores and spending a record amount,” Ruggeri said. “Increased efficiency is driving operating margins.

“Customers are favouring more premium beverages and customisation, therefore we’re leaning in on innovation.”

Robust trading was attributed to a combination of menu innovation, marketing, and strategic pricing strategies, along with record store growth and uptake of the rewards programme in the international segment.

“What’s happened in the last several years is how much this business has evolved to meet customers where they’re at,” Narasimhan added. “We have a widely diversified set of channels, unlike in 2008.”

In September 2023, Starbucks marked its 25th anniversary in the UK with a drive-thru site opening in Oldham, and stated it has made “good progress” on its target to open 100 new UK sites in FY23.

UK growth will be driven by drive-thru locations joining the 1,150-strong UK estate.

Starbucks opened 816 net new stores in Q4 and ended the period with 38,038 stores, with stores in the US and China comprising 61% of the company’s global portfolio.

Operating margin increased from 14.3% the prior year to 16.3%, driven by pricing, sales leverage, and in-store operational efficiencies.

Starbucks’ long-term growth model will continue to be driven by new store openings, comparable store sales growth, and operating margin management.

Commenting on FY23 results, Narasimhan said: “We finished our fourth quarter and full fiscal year strong, delivering on the higher end of our full-year guidance. Our Reinvention is moving ahead of schedule, fueling revenue growth, efficiency and margin expansion.

“Notably, we continue to see the positive impact of our Reinvention on our partner and customer experiences, proof points that we can continue to create, grow and strengthen our business while creating value for all. As we enter the current year, in the face of macro uncertainty, we remain confident in the momentum throughout our business and headroom globally. We expect sustained momentum throughout the company for years to come.”

Ruggeri added: “Our strong full fiscal year 2023 performance demonstrated our durable long-term growth and Reinvention plan execution. We are proud that our full fiscal year 2024 guidance will be grounded on a balance of both revenue growth and margin expansion.”