Starbucks Sales Spike As Customers Splurge on Pumpkin Spice Despite 6% Price Hike Starbucks' sales have bounced back to nearly pre-pandemic levels, according to its quarterly earnings report.
By Sam Silverman •
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With pumpkin spice season nearly behind us and holiday drinks taking center stage, Starbucks' Q4 earnings prove that people are still willing to splurge on their specialty caffeine.
The coffee company's sales are back to nearly pre-pandemic levels thanks to a "wildly successful fall promotion," CFO Rachel Ruggeri said on the company's quarterly conference call, per CNBC.
Starbucks saw higher earnings than Wall Street analysts predicted despite raising prices by 6% from last year, according to the brand's quarterly report.
Starbucks reeled in $8.41 billion in revenue; analysts predicted its revenue would be $8.31 billion, per CNBC. Earnings per share were 81 cents versus a predicted 72 cents.
Furthermore, U.S. Starbucks stores saw 11% sales growth, with pumpkin spice sales up 70% from last year, according to Starbucks North America president Sara Trilling, per CNBC.
Although the company claims it's not planning on raising prices again anytime soon, it saw that customers are driving up the prices on their own by adding syrups, cold foam and other signature Starbucks extras.
"We saw accelerating demand for Starbucks coffee around the world in Q4 and throughout the year," Howard Schultz, interim chief executive officer, said on the earnings call. He also said the success is in part due to the reinvention plan introduced in September to invest in and revamp its stores and customer experience.
However, Starbucks' international sales declined due to COVID-19 restrictions in China, its second-largest market. Those declining sales will likely impact Starbucks' Q1 2023 earnings.
