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Starbucks mobile order-pay usage increases

5 percent of U.S. transactions through app in third quarter

Usage of Starbucks Corp.’s mobile ordering and pay smartphone app covered 5 percent of all U.S. transactions in the third quarter ended June 26, up a full percentage point from 4 percent the second quarter, the company said on Thursday.

Starbucks completed the rollout of mobile ordering and payment to its U.S. system less than a year ago, completing its expansion from iPhone to Android smartphone devices in September 2015.

The company also said membership in the Starbucks Rewards loyalty program, which it revised in April, had increased 18 percent over last year. Starbucks, in its earnings release, said it had 12.3 million loyalty club members at the end of the quarter.

Starbucks’ third quarter net income was up 20.3 percent, to $754.1 million, or 51 cents a share, from $626.7 million, or 41 cents a share, a year ago. Total revenues were up 7.3 percent, to $5.2 billion from $4.9 billion in the same period last year.

Global same-store store sales increased 4 percent, including a 4 percent increase in the Americas segment, a 3 percent increase in the China/Asia Pacific region and a 1 percent decline in the Europe, Middle East and Africa area.

Starbucks chairman and CEO Howard Schultz said in a statement that the third quarter result “demonstrates the strength and resilience of the Starbucks brand and business around the world.”

“As we enter Q4 and approach fiscal 2017,” Schultz said, “we have clear line of sight to returning our U.S. business to historic levels of comp sales growth which had been at or above 5 percent for the 25 consecutive quarters prior to Q3.”

Scott Maw, Starbucks chief financial officer, added that the third quarter was the first non-holiday quarter for Starbucks in which operating income exceeded $1 billion.

“We are confident in the correctness of the strategic, operational and digital moves we outlined today and remain steadfast in our commitment to deliver significant, profitable growth over the long term,” Maw said in a statement.

Starbucks opened 474 net new stores globally in third quarter, bringing its total to 24,395 stores in 74 countries worldwide.

Contact Ron Ruggless at [email protected]
Follow him on Twitter: @RonRuggless

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