Starbucks (SBUX) 30 Oct 202020 Q4 Earnings call transcript

Good afternoon, my name is Devin, and I will be your conference operator today. I would like to welcome everyone to Starbucks Coffee Company’s Fourth Quarter and Fiscal Year 2020 Conference Call. [Operator Instructions] I would like to turn the call over now to Durga Doraisamy, Vice President of Investor Relations. Ms. Doraisamy, you may now begin the conference.

thank quarter joining results. and and discuss today everyone fourth our fiscal afternoon, you us for to Good year XXXX discussion by and led will President Today’s CEO; and Kevin Pat Johnson, CFO. Grismer, be we Q&A, and Channel Officer Development Americas; Chief President, Global Coffee, for by Tea Roz will And Group President, Group Brewer, Culver, John and Operating joined International, Cocoa. be & materially and statements, from uncertainties will call subject are conference results which to statements. include actual these forward-looking differ could that various This cause our risks to Any factor in quarterly in and report such SEC, conjunction with our earnings annual should be XX-K statements considered our report the cautionary on release discussions with last Form statements and filings Form our risk XX-Q. including on in

results prior forecast. Starbucks forecasts a which non-GAAP actions assumes strategic on information. and In were addition, we and These include variety the excluded to estimate to information the time assumptions, impact any related virus integration forward-looking no our actual transaction available were impairment These several to were items and our created fiscal of items these on update of of comparing reasonable. spread the COVID-XX the based believe at previous we results charges, items. in GAAP from costs obligation restructuring XXXX results. and to including other statements or are by of

well will GAAP available being November through measures on Kevin. as please our financial call the This archive will website call to corresponding measures XX, now be of over refer a at the these Friday, financial is call, find measures. to an website and non-GAAP turn today’s certain Kevin? to the in conference their GAAP For XXXX. corresponding I mentioned webcast measures reconciliation our webcast with investor.starbucks.com non-GAAP as of

us has Good today. afternoon an year. thank for been extraordinary XXXX joining you and

much to been apron shared efforts and away partners I one and together, that the that responded, the Starbucks at come reflect outlook optimism. am by. partners fuel that dedication very to inspired how green positive enormously from probably and communities. us global and familiar pulling from it. experience and wear of hope along of This the with another, planet learn customers future. for and courage, and three on this pandemic together these a been be grateful As today’s words safe forefront experiences my the gives have They everyone our that I’m navigating resilience churn. throughout There of creating are you shown has Starbucks me all implications proud upon, inspire serving for who confidence, take for the compassion this I call, they’ve support

Let me explain.

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onset quarter, engagement U.S. Of QX, In fiscal COVID-XX. of increased up prior tender for key company Starbucks Rewards of to course, another XX% our is drove operated digital our consecutive customer the XX% second driver QX of program. Starbucks Rewards from in a

Rewards as mobile contribution spend throughout higher to previously. improved pre-COVID by mainly and levels and Starbucks recovery pay Importantly, order I outlined returned and in quarter the member driven usage,

card X downloaded at The XX% grow key regarding for late and of customers. up grew is of payment Rewards highlight active in the base throughout in of program joined who QX including million, number the quarter launch These stored million QX, likely levels us early the QX the Additionally, members of a number our of flexibility momentum The Stars Rewards app the approaching Stars the XXXX. to member that of $XX.X Everyone by resonating in the the number in prior saw by XX-day active in indicate and mid-September Starbucks the from everyone. slightly quarter. customers QX the value customers increased for gives continued optimism successful of active to we pre-COVID launch QX the results ability rewards removal who rewards options, earn was requirement Starbucks meaningfully members relative Starbucks in year. our helped XX with stars to day This fiscal

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substantially to off stores approach as early development disciplined in paying start Our returns store with are to line with off a levels. these is strong new pre-COVID

which part of a that XXXX Pickups in agility opened similar innovated to innovative convenience. and of very program increasing format the our in state presence development China pace the caters very new this local Starbucks retail Chinese Now As U.S. stores XX encouraging. New the With need is for speed with the Early nine has store Starbucks China, team Starbucks to results of And the cities. in the in are fiscal concept. team development is

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U.S. innovation at in we the specialty where continued incredibly trends I’m seeing extend Coffee the Home, of China. customer remains pandemic. to recovery leading industry The business, proud of elevated As retail demand the through and are in

XX% grew and softness brand and mindset reach drink XX% coffee In category, applying the to all offsetting was to Alliance colleges foodservice of accelerated sustainability while traffic. to Through as growth in grew the business entered XX dollar Development Starbucks new Starbucks growth the commitment products. we the at-home channels hotels, Coffee the We offices, to QX, XX levels total introduction including centers significantly the package of innovation, capture through grew with coffee this maximize are which coffee Creamers in in continue of QX, to Coffee and share markets in bringing Channel full Consumption at-home in just in share business the packaging of Global U.S., of in outpacing our QX Starbucks our to recyclable portfolio entertainment and experience months. domestic, in sales the low strength We to X% somewhat nine Nestle, with quarter, XXX% with quarter. ready platforms. products in presence markets Starbucks our at-home innovation maintaining across the coffee our Global non-dairy Alliance our agility and of coffee to

to In to performance continue than ready truly they the our the Starbucks around portfolio. Overall, where amplifier. very are business. of Starbucks is customers the continued the We with year. also Nitro a meet are brand world in Exceeding through expansion X this innovation pleased ready-to-drink the category through brand the accelerated global Brew, we This expectations. is the summary, channel number of Notably, stronger drink the brand ever. Cold

rapid work the built customers away transparency Partners we through from level heartbeat apron to approach stakeholders Starbucks. been gratitude. mission resilience incredibly from combined of economic future. and XXX,XXX We with day. of our of fill the confidence adding agility dividends possible in all our our this without to built drive provide will hard and for by and they Company strategy, all partners ’XX world made from to to Starbucks our we’ve believe day. who investments take would for well-being words None around additional serve the our with away recovery our and well, you, three long partners. that one is built by live progressing green take are and the stakeholders and recovery Thank spirit each with to have and Starbucks partners gratitude our certainty and positive of of our They suggesting remarks optimism today, them and every and me with the future. inspiration. the this close business our for values trust principled business innovation, I resilience have decision-making communications about the future of you continues I new that protect Our fiscal word open into call, my innovation pay a

now for to QX performance and our year fiscal for hand ’XX. Pat? call XXXX as to Let the me financial fiscal as well our Pat discuss over guidance

Thank you, Kevin and good afternoon, everyone.

Kevin As with the operating are all shared, we our segments, our strong delighted performance driving a of to XXXX. fiscal finish

primarily negative $X.XX to reposition higher-than-expected to down store EPS strategy was in for discuss $X.XX the to $X.XX, on in higher some We by segment modified in estimate variable product store that and the outbreak. non-GAAP sales of lost our year, traffic. and from guidance approximately tax then QX of Americas income well decline by respectively. of revenues prior EPS provided QX now estimate impact prior faster-than-expected COVID-XX sales and considerably as year. to lower The COVID-XX to as the result QX COVID-XX was about a QX For $X.X billion, enhanced our quarter, wages as efficiency. well the was than reflecting of rate portfolio $X.X the and margin as equates reported million provide Americas call, year, our a royalty driven a XXrd sequential inclusive the we sales increase reduced due Relative $X.XX. of expected COVID-XX rate to and estimated QX billion, Starbucks billion flow-through a attributable the pay on labor benefits, QX revenue impairment the impact segment’s to to and offset decline I year in and restructure Americas. Americas. licensees wages catastrophe week. from related deleverage to impact acceleration driven to At prior margin declined essentially, typical customer the QX, for as our EPS and programs significant returning highlights sales decrease improvement contracted be million including fiscal operations a and is an the impact in X% XX% as margin be guidance We QX, impact lower $X.X costs revenue X% discrete the global QX restructuring improved from and the $XXX flow-through QX the comparable prior and to points Americas’ well sales on of as Starting of operating and on rate. revenue was costs prior including revenue This operating from labor consolidated with QX to the in as XXX Company-operated non-GAAP in approximately retail partially XXXX, items. X% XX.X% growth $X.XX year. well of recovery from than GAAP incurred, basis in last earnings of partner $XXX performance range efficiency. the due certain will primarily COVID-XX the by a will the as consolidated in EPS additional This lower from down XX% provide

and Importantly, month. profitability Americas’ with decline a profitability U.S. of in the XX% across August sales of and each month quarter. improvements minus posted sales from The and X% September, the every positive positively achieved improving business quarter trended in the comparable sequential

seasonal segment’s and of sales faster-than-expected the store strong in China. boosted growth Including product XX% comparable drive-through highlight performance like by I lead quarter promotions benefit, market, QX, X% to VAT now in minus on performance. the fourth would our of to international recovery Moving sales reflects a successful International. Japan,

improvement store exemption up the VAT X including on slight to China’s were a a of basis. comparable For benefit, a like-for-like reflecting August’s comp point sales X%, percentage month sequential September,

the labor percentage quarter, International’s VAT store store the sales X $X.X product comparable rate million X% from QX impact margin of approximately a reduction a was royalties government programs. stemming the efficiency waste, COVID-XX prior primarily from respectively. year, China’s primarily points. on to by operating due lower revenue the and COVID-XX. and Non-GAAP fourth Revenue due to QX largely as X% On million due International’s by in versus XX.X%, impact the decline to and relief as XX% declined year offset COVID-XX, asset and $XXX XXX operating including sales. sales to and temporary Coffee favorability our well improved million For single-serve including decline International’s revenue to estimate the QX technology were basis including primarily income higher from of to Alliance to reduction non-restructuring sales decline Also prior in transition-related the in the QX, in in lower partially $XXX structural certain year, due QX, from declined store points was decline a deleverage to lost prior approximately contributing billion QX was in comparable benefits strategic to that of X% roughly items licensees $XXX primarily Global a Channel to on mainly initiatives. due in digital XX% change Development. sales flow-through International’s impairments, and investments, business. our from XX% We the

COVID-XX revenue growth transactions improvement a of on XXXX will by XX% navigating are typically based by offset and of non-restructuring to year-over-year rate XX.X% our be earlier, in wages year, In of unsurprisingly, due in as declined deleverage much QX, strength transition-related revenue estimates the approximately growth investments, was the the XX% roughly our to U.S. store these operating fiscal from XX% to operating both guidance of mentioned across the observe in and as barring million. the is as markets, COVID-XX impact fueled savings. down billion China. business. growth, to XX% variable impact to of operating on non-GAAP COVID the the Channel sales Company-operated the global for to QX this traffic any now foodservice margin reflecting and supply growth business change basis more past At from by months, innovation We a as attributable the items, approximately built chain infections mainly prior impact driven our efficiencies business coffee and as we’ve which growth flow-through reduction the and year sustained for I experience expanded QX for adverse impact $XXX margin our was key gained strategic due QX that comparable sales driver to and rate ahead. products our lost well of to XXXX. for driving single-serve that in the the business. and Channel expect sales operating from ’XX well on revenue, the in X% including by non-GAAP close COVID-XX in we in prior that offset estimate, consolidated to provide level, our Consolidated mix flow-through benefits equates to in operating I segment’s initiatives we COVID-XX ready-to-drink. key impairments in stores, new shift, points comparable partially the the and fiscal the by $X.X asset in our comparable well Starting of global or with on labor partially relation XX.X% sustained business, into significant XX.X% that Development’s the disruptions, at-home Excluding we’ve These XXX Development’s structural waves and as margins ready-to-drink the store our economic we year, by for nine QX store of the COVID-XX income plan protocols of resilient

by XXXX sales full we fiscal in between and to grow in continue For and XX% the recovery sales expect comparable to our fiscal to stores XX% our to quarter. U.S., the nearing second of seating we are end by Americas achieve cafe the to to and store we This comparable the the U.S. of store second at expect quarter. hours . that end U.S restore assumes capacity continue full operating able the

full comparable segment, to For operating estimate between COVID-XX well on hours XXXX. sales the locations. with continuing regular as in in substantially fiscal as Japan grow and almost we operating lessen XX% in environment China’s This International current XX% unchanged predicated to and is remaining impacts seating store all expect

will first in end continue We China’s expire recover temporary expect store which of benefit January. will the sales quarter, to the we to comparable our fully exemption, the from expect to excluding VAT by continue

fiscal between full China’s grow sales the XXXX, XX%. and expect For XX% comparable year to we store in

the store to next retail development. driver, on growth Moving key

’XX about Although in to approximately fiscal closures to in fiscal ’XX, to openings X,XXX in from of store repositioning prior XXX our to than X,XXX slightly. a to targeting business, we the XXXX is we stores year accelerated portfolio Canada about U.S. expect open we new but This did of due store license primarily portfolio. our more higher globally increase restructuring expect X,XXX closures our year in reflects fiscal also store ’XX. compared approximately pace the and versus of in last International fiscal store

approximately result, XXXX. fiscal stores a X,XXX to expect As X,XXX we approximately add net XXXX, down from new Starbucks globally in in fiscal

for the accelerate we to be our the initiative fiscal The area in segment trade development XXXX, new mostly store the with we way that to closures the XX closures metro clearing store approximately are intense footprint approximately Americas, XXX the XXX in announced the new, transformation openings net of part U.S. located store in the of the ’XX retail additional the evolution closures dense roughly June centers, transfer. is efficient there centers cater we of convenience, sales formats expect store an for our in plans For more Americas across current reflects for stores. new store XXX area metro performance, operated fiscal on in based trade desire customers’ that store where the mostly for guidance outlook store June, while Compared on announced profitability. in improving potential portfolio, Company the our to increasing also yielding

and yielding close store as pace as next a markets in licensed International, including of China. the licensed ’XX resulting stores X,XXX of development U.S. from many of in XXXX, in well pace recovery outside due reflects COVID-XX closures stores part, to new we This relatively pace For XXX relative fiscal International to X,XXX net fiscal expect the a year, slow XXX stores approximately store International higher net slower the slightly to impacts open new approximately in new stores, approximately of

Importantly, we the to development fiscal expect store our XXXX. believe we guidance and long-term net annually global in impacts return X% of to pace are of X% to temporary, these growth

back revenue segment’s resulting and fiscal We Keurig February. decline single-serve in The structural $X.X a in fiscal the in not XXXX billion took to of all up, to a our by more last single-serve Development’s million Adding this change that business billion range the between expect expect in approximately billion $XXX between attributable XXrd week. billion billion, week. impacted XXXX is an fiscal primarily Nestle revenue change. Pepper, consolidated was $X.X attributable range our royalty do based including We arrangement to XXXX, to $XX month. Dr Channel in revenue we expect between announced including in be XXrd $X.X and the it construct and it Starbucks to Pursuant for $XX business profitability the revenue in from to that anticipated materially

our XXXX expenses our Number year, year; emissions. across water sales are three incremental prior environmental X, we fiscal expand enhanced and expenses margin. X, engagement, carbon ongoing XXXX strategic X, reduce from to These improve and investments further waste improve technology to The unique tailwinds, efficiency; investments operating primarily spread supply X, impacts continue partner X, recover tailwinds COVID-XX. drive we on concentrated offset by chain to number by our over consumption and operating Globally, partially margin supply the are significantly move costs, digital operating benefits; investments prior to X, number within store primarily areas, three Let’s the wages in sales chain expect retail store certain driven number and the product in efficiencies. the G&A. and distribution to number and and strategic of sustainability of absence operating are COVID-XX number three related business. customer leverage, The in as to fiscal

Let one me to the for equation add operating fiscal point additional margin XXXX.

in impact and to year-over-year fiscal range our first operating deliver commodities drivers, of upper operating to margin of range XXXX for costs. are priced a our product year. non-GAAP our the expect progresses. half non-GAAP as all the have margin half the At in these significant margin the we mostly needs this minimal starting Similarly, well we this year impact fiscal basis overall end on below coffee retail We the between expect distribution rising XXXX. of the to lower XX% and XXXX point, this end be improvement expect back locked XX% in of above on and Combining fiscal of the segments

Development, the mid we ’XXs Channel the driven single-serve line, operating to described. I $XXX For versus just billion $XXX business we eight approach expect structural expect exceed by between The the in levels fiscal is our pre-COVID-XX be debt change by operating interest million totaling million XXXX fiscal Below the to in $X.XX expense months. and issuances which income increase in $XXX driven in XXXX. and million margin past

times our remain and committed we to BAAX X leverage cap Importantly, BBB plus of rent credit rating adjusted one EBITDA.

fiscal the off XXXX flow, COVID-XX a a Directors of in as increase Based paid announced, commenced have cap, latter dividend to to part we impacts increase our XX% report cash dividend temporary flow to I’m our the we While as of XXXX. our upcoming million we view leverage representing quarterly return our in annual improve and targeted Board Company resulted exceeding term impacts expect leverage near extinguish previously that on QX consecutive continues strength as in the happy $XXX and XXth debt that to our since the maturities. levels a to the of approved operating in and loan of these Starbucks cash we paying we

GAAP our certain from we not fiscal items expect to of to XX% XX.X% same non-GAAP XXXX tax As repeat are and discrete benefited tax which tax degree in XXXX, fiscal in compares that rates GAAP to and rates non-GAAP with our expected This the mid respectively in XXXX. XX.X% the tax be rate and range. to fiscal in effective

Finally, our of we currently expect program suspension XXXX. the the balance to continue share of through fiscal repurchase

re-acceleration following X, slightly development new the of capital fiscal notably to earlier total in development a Coffee of than X, and our what expect higher spent pause temporary Innovation the $X.X Park XXXX. that expenditures global store We increase the year. number chain, this two we China expansion we supply an fiscal the of during announced approximately to primarily XXXX attributable things, in billion, The in number is pandemic;

fiscal to we currency in up, from foresee of at movements it expect juncture, When the $X.XX impact all XXrd week. Finally, for including minimal EPS you XXXX, in we add $X.XX in $X.XX XXXX. this fiscal approximately foreign GAAP the range

range We the fiscal approximately again XXXX including levels. pre-pandemic demonstrating in extra the of in EPS non-GAAP week $X.XX to and expect $X.XX $X.XX for further recovery approaching

EPS current EPS of $X.XX, $X.XX the specifically, range $X.XX reflecting of recovery. the and in our range to For GAAP to stage QX, we in non-GAAP expect $X.XX

dampen this QX with expect tends normal that quarters in higher seasonality and combined EPS meaningfully expectation year. the third to and quarters first QX, for Given the of our the compared EPS to we in fourth two the EPS

things up. me let wrap So

On my deliver happy joined momentum our committed XXXX experience sustain model, With green Company’s advantages of for express Kevin We the in our and focused Culver, the partners to consistent customer our a investments Thank at in Brewer the exemplifies apron and Durga growth the is would that I pace your making Roz recovery like and We to our the are our to values, as to of appreciation manner competitive by the are by our confident questions, of mission of John that XXXX. provides delighted take who brand of that, the we business it the Operator? are top reinforced execution fiscal durability and call. fiscal in you. agenda. outlined and which business. remain are strength foundation necessary truly that Starbucks to the with unmatched and a of note, our I and

JP Please question of your from comes Ivankoe first line John with proceed question. the Instructions] Morgan. [Operator Our with

was you lot have have much. congratulations of the question the it, you thank obviously, can have apply Hi, the a but Yet margins, very segment embarked call, you really have here they a to on in I you you've expect, had that order to assume you efforts well. specifically progress call. driven margins, to mean, China, alluded continued and made. in a simplification unpack as very -- but that couple that on labor companies very potentially lot as of A that think I U.S. I on you've in but could the you to, not, the some to you I pay, significant give mobile the of leading and which be efficiencies customer shift have the times choice

we question, were margins you kind to achieve is margins? peaks? back a need unit we as you're So back volume to where of get XXXX, an environment, both talking type start, relatively an to previous you we on may unit those think that are in of potentially do And about to average relative in the in think what achieved recovery, segments to volume about, an you're can near-term average be of previous getting some

hand that. to Pat We'll that handle John. Thanks, to

Thank you, John, question. for the

like stores welcome So customers customers, the increase that mobile very instrumental including productivity, both social ensure cafe in digital and complexities pleased distancing pickup. to seating of frequent in partners our our in digital added and with cafes, and and been we've the impact our as business even to for has of to respect labor of that But as and to enhanced order our cleaning, we've on some which to operational to back business. our been And our is closed, has the business, remained in with pay safety managing come more the ability for business. as increased, the customers our has our even our growth

improved as with would productivity is partner the offset this and And complexities, we new wages along we're a to making to of operational incremental of attended have And investments otherwise that so result the these labor some realized. benefits. enhance

that's with the levels QX. that very trail productivity driving much our as remains sales Our of I continue new automate focused as want fiscal productivity, that labor we in ‘XX operating to recovery do ensuring as that the overall But And labor redesign team largely the technologies of stores. introduction returning in-store on enhanced reflects to routines, will margin through are recovery, we guidance pre-COVID by tasks. to well clarify

combination to our we that the require, leverage with a to customers recover responded as through we've along benefit really atmosphere it's new we're welcoming and safe able and store So business. provide partners sales that to of operating from our how how environment

how is Now, you what that compares that the fiscal unifying we would asked to ‘XX. to average achieve need and

know, recovery, store includes quarter, you that expect of anticipating a I by lag will that productivity. our end that, beyond but fully we're dynamics see quarter the the and will fiscal be recovered mentioned before comparable two the of margin sales As there have to improved second we full we because labor

Jeffrey line with comes question Barclays. Our Bernstein proceed from Please question. with next your of

global broadly, plus unit growth very of as the but your from in think in Great, plus. Question which growth and China thank unit I a more is then a ‘XX, XX% falling fiscal like growth well. looks you you culminates And prior about I things, step-down much. specifically, on of guidance XX% China the like talked X%, little the know X% unit to side your short

whether the you more to Thank everyone and point. of plus seeing estate, either that demand. or estate large there's much. you or post-COVID as opportunity talks going to closures think wondering, numbers, or very things whether you're gaining at better in store So that those just kind real specifically, more the of of attractive get from maybe real this it about I'm is back XX% And independent China, gaining context, any factors, you're partners

Culver. Thanks, John Jeffrey. take I'll hand would you that. over John to

Yes, Jeffrey.

terms and if time, then look the from concept standpoint what of at acceleration stores seeing, historical far. return that you now, encouraged thus into those store for back And makes and for we emerging gives opportunities to a the trends. And by year-over-year good actually we're the the a lot feel sense. innovating we're historical are accelerated new China, At of Starbucks quarter optimism store the a count the We back getting open but XXX, that do record back to stores where store look the guiding seeing XX%. XXX of same in For And model. at continuing growth to And new faster, performance to growth. see We're we're us go our growth have the we room in had and in QX. we pathway a with we're about perspective to it very overall, levels.

in So We've it. with number we we the ongoing partner to to landlords to be the And to and committed fully opportunistic had we and sites, that we our of for with growth, we're go looking more, we're that. continuing they're going business. committed where get discussions it, back after part are about relevant us will believe can as accelerating to grow

XX% us, for on growth. total will continue push for accounts to It So XX% store hard roughly of to our we development. revenue

long we the see we a this there. given see big piece, runway So as

And Jeffrey, this is Pat.

a Just it of ago, reaching see remained of optimistic was in Conference we end couple stores that we Investor will acceleration about to what and goal term in that at think of a talked X,XXX by on fiscal John our years new ‘XX, unit China that that longer number the ‘XX, build of China we imply said, I development will the we’ve achieve an China. that in following has does fiscal pace

your question. John Glass Morgan with And Stanley. our next the proceed comes of line question from with Please

about you where for Starbucks that company prototype ’XX where And that developing at is or a about, licensed ask of in to you closures Canada, in about in the Starbucks Thanks for you closures, new talked tow think get of just how thought of a very including XX? that originally that closures you think are development? U.S. an on the now much. equation that evolution unit to but is and also you talked in to in make wanted you in And about to I open I U.S. acceleration XXX changed question the maybe the thinking in are XXX the you stores? development example that and that closures? XXX that Americas do more is [indiscernible] your about the or go also the in

want you Roz, that? to Hey take

Thanks, John. question. Yes. Good

as at stated of as about where closures levels more XXX gone returning process, the What their much about in U.S., and COVID coffee. access new remain XXX number customers are So you learning we learned historical to we we've store pretty the closures. with we've in are -- concerning stores our through line the

Part that we've of new is this can for the also offer stores. the have our we So formats what U.S. closures accelerated us. learning planned to

increasing formats, number includes instance, channels new we of in as And so it also we you our that question are new the the for format, ask new about units have the well.

U.S. with about in end restoring X,XXX the We’ve current the we we on actually seating stores, restore our XXX So stores of by those our of of stores working have seating. sized in XX% at have ‘XX. are roughly

area And of we – forward, have have and we're throughout move we York one so as that in opened accelerating are this three we areas. units the new will we year. more the New call go we of we go adding throughout as units those -- as year, continue pickup And stores. we deliver in the And year. to but build throughout the that those your Toronto And

transformation our about respect XXX portfolio. in that composition area trade has via And reposition Canada, the Americas John, we the to XXX When closures with closures June stores. company Roz build our we in to U.S. the was and all in operated our X-K, as talked on store what XXX announced the back we in of said just

we've the that originally largely manage summer, the we've part you efficiently been we've course know, that over is closures of lease the place, that started XXX closures XXX U.S. strategic in we incremental is the we've anticipated. costs. with store of more the our what that's reason the why And so And And average XXX that the up to as exit process plans accelerating the and that's has portfolio repositioning the about of much in Canada. announced we about in than had team already the learned taken able

on locations, while ability to the these benefit of a stores. the in spend this big shareholder experience a position that nearby to with metro it's how we to a of the how the go avoiding to identify closures from unit enterprise more that out that. not much able flows And At underperforming take the closing a are And would these reducing additional us costs enterprise. certainly have pays just back future that but of insights then an store than value stronger working transfer our lease portfolio, create through would improvement with to some the trade guidance at meaningful are over operating the into cash along incremental losses and XX we strategic thing level, points. look dense have information, of even to the put move at the per basis more and new rapidly operating stores, that Americas to margin, that so CapEx capture for the remodel is order of sales also And stores So in XXX transformation state. exit our were is and our performing otherwise point areas only through with a I would our at that course summer

even pleased growth really a plans stronger with able we're team more us over also course going our of the has that been the together So learnings summer, the much put their profitable and position, to to more respond how for to aggressive forward. structured put in going and business are

proceed question from please with next Bernstein. of comes Our one Senatore Sara with your Please, question.

been little and you, having same-store to you I I target. I've hear trouble. bit ask sales wanted hope me And of a about can Thank

ticket obviously you that next that plus just volumes would that drive you year versus between the flat from said a is ticket, the the U.S., some implication started think related with through. also XXXX at is get think be it conservative, ticket I with up and traffic, and that considering is XXXX somewhere also you as we about in COVID of X% higher but higher X%.

less the considering we expect, might Thanks. comp possible traffic So the driven, past this then year? recovery through is happened perhaps what

to once Pat some it. Roz you color add then and let start

Sara. Sara. you, Thank Thanks

quarter And we As of thought to help able we thus level to to consequence recovery may next appropriately based we we've our of to conservative as target. yielding of the based to the notwithstanding leverage about current today, to only and are into those we're significant not two be going an total unfold, are environment, for prevailing both intelligence very every we and we progression taking that like next conditions have and look operate or in we how expecting, uncertainty the inform store, built, fair an analysis enter linked, how what have as stores consideration with for each provided faster be on been comp those this be an over models in to I store, for hedged the the pandemic, there also and to very team fourth summer to course say based things appropriate pleased what momentum each strength the data internal expected as to projections, -- somewhat environment. does And our the that but is happening every our have what our results external the includes a remain And that is the year that is fact it's variables. how progress has a strong what on very that are the as that we than expectations our on work pleased. of we in team in broader current acceleration year. consider we've think economy extraordinary year, far, that And artificial whether significant

reasonable in question our think year has balance, on driving that the of on degree to your can that communicate to policy expectations the and say against relation last that of is pandemic to what's ability And guidance that we appropriately our comment that remains in of into Roz and I would experience I ticket have pretty ask outcomes depths the somewhat the are deliver in to our well. year do next will confidence environment. our reinforced but how here second current so So no conservative, we to the traffic? we that versus I see trending growth. part And

there's I'll two and Yes, do. things

there's areas to terms start in four all, I'll at, of we're back of and First there. transactions, returning stores, looking our

right far. of mid seeing direction, what looking stars we're we're everyone new program, in September, increasing with that in the the all, members pleased and our we in for the loyalty is First moving program so at introduced

Secondly, be the where our our store portfolio, better just more in repositioning talked we future. today where and to about customers as importantly, they'll they are meet

going our And for customers good So it's engagement for do they and the customers. need and and also enhancing good we of for that our then us our our future know we to connect now work creating pipeline partners partners for fall innovation, our experience that when and best in moments of us. forward. in then And the benefits seen we've pumpkin our yield and the products, stores a leveraging lastly, which spice our that's robust beverage of outline

enhanced, work we're ticket $XX In looking terms in that the Ticket doing we're right been now. ticket. at about at terms of of has

And of so X%. in and so, we're the is time pandemic, what's the reintroducing just we're price happening there reduced keeping reliance that price during our the on price we to range that X% of now

then So we attached. beverages, the of size multiple size continue and beverage so larger to of the in see terms beverage, beverages food

be And through the strong continues for so hold year. ticket us projecting to we're back and to

mix the higher incidence expected, stores And drivers, provide channels, just the part spend to tends you help average a and I group comp a But bit more she believe of a be may to understand inadvertently well the by XX% driven in an XX%. said orders. little Sara in company sales drive underlying due and at of shift to just COVID, had of we where operated meant the have U.S. in numbers. onset toward primarily beyond, our ticket what accelerated MLP was some higher on to $XX through of that And to Roz some fabric

cold I that's it those the growth like plant customers driven in that beverages offerings, and treated has the the transits]. above pre And in in in range appeal as refreshers Now based quarter, to mix as second and of themselves COVID-XX further quarter, U.S. highs an in X% but -COVID a and at priced of would remained of came lap ticket increase fiscal do [vendors say expect moderated ticket part was where XX% average latter frappuccino from consolidation, which future order compared customer as quarters, also our moderation higher benefited levels upsizing are a and of of growth premium We X%. in previous well priced. particularly quarter our the onset the more fourth to to ticket shift the our we for by to that

up see its behavior are of grow. company buying doubled record led and this larger modifiers for at for and to this ticket themselves you increasingly offered then Specifically, innovation, consumer for, fiscal in to space, adding changing product is continues benefits our I net how in milk. expect coming, suburbs. growth. to only how we're not milk others. And highs, And is the it as to ongoing Maybe just as the And for higher impact we how oat purchased dairy has from urban Remote attached a ‘XX, may premium they're they're sales the but beverages party find alternate of share size, U.S. who relates has food order the addition this seeing positive alternate to couple modifier momentum and terms consolidation to things, business. nearly working with previously showing in has transactions the the of interesting it's of of in includes quarter. in shifted And customers think

fastest through recommendations, an In year the and think in drive visibility moving clearly fact, which We larger the and it's with trial MLP. forward. new grown is menu even will personal unlock sparking because accelerate

expect actually which trended routine. Food Now, grew. start grow. through And believe transactions will of slightly the happen quarter, we the is attach has our while continue that as we to beverage down attach trial

innovation into And as our last us with are giving guess say resonating see very I encouraging that the head we So we holiday. and a would is our this as promotions I optimism thing the customers development.

our broken we products and plus sandwich more also Now wraps, new the to And excited we momentum those existing like impossible to customers We're are giving visit. promotion. new enjoyed fall frequently. saw refreshers. strengthen reasons our And customers reasons the giving breakfast from new breakfast it's visit with

the promotion, November of And we the as move will so sustain holiday our momentum. that us month we into confidence with that gives

of a give the again, optimism the back we our COVID for Year. lap we material to to But as expect half as that us So growth variety enter New related in year more things start traffic we grow. as the reason of the ticket of that moderate to impacts to continues

David from question. comes Our next Tarantino your question with line of Proceed Baird. with

about the a I quarter. I August good had comp to Hi, September. afternoon. was a U.S. guess question, trend, from the it exiting And move pretty impressive

could what And that you're quarter you're the for quarter? in So you help he's assuming change factors EPS guidance? far I is was the trend maybe if drove the that step understand wondering maybe then together seeing current so comps. that that current that in And, if just if Pat, us the you're you could the willing, in

David and will think drove I up that Roz question. the color second and you some on that Pat on follow action add you ask

Sure.

the were several going quarter, things with us there So into our performance. that helped comp fourth

One of stores those work the deployment of number practices terms performance so putting increasing had we efficiencies window in in the out had the things efficiency better that of into and and drive-thru stores. labor is and those we that actually performance bringing open, to and place drive-thru expanding

had from advancements stores stores, more in already areas, ready metro that saw and located Cream that, in addition our we In our seating had We customers suburban out, regular coke, and to our with in and those time at baristas as recognize that, those comfortable which began Cold we addition did having times. advance improvement around then to to beverages in into product our spice drive-thru mid-morning, the also stores. in stores feel Pumpkin saw happening to we coming our great to Brew our addition return the hot success and we coming introducing we business seeing seating pumpkin more morning, the

adjusting customer along the as them. adjusting, we was with were So

so improved of quarter. exceeding began in combination we stores our the And addition beverages, effectiveness, efficiencies, to in-store fourth labor in our new deployment, comp drive-thru to performance see

minus Roz nailed XX% that of key X% And – what David, in said September. just August were the Roz to in build to on it improvement from terms drivers what minus in

teams because we the September, the recovery, all the to And why of were if where full operational that think alongside You and reopening or recover, managers is the summer, what to full months, as April was won't the our we of that closer our improvement remaining back in wondering, store second much Roz And is the X% for say end the stores. another few those I store to would recovery business may when recapture end we highlight improvements and mentioned, across six sales minus May percentages, timeframe are life. progressed comparable have see how becomes brought we be quarter, the that, until would we attributable it to get of their that harder March. you saying and, our in hit to reopening seating great then I

Now on curbside like where have things to we're at a pickup, the store improve handheld newer some we productivity. of innovations relation heavily to rely drive-thru to at point in more POS or the

there drive-thru. So is we demand more capture our that can at of the

expect So forward. from we this more gradual do improvement point

it's But be going September continued what today has going recovery exiting October. enjoyed the I tell strong has to will either. momentum been not necessarily think that we month into that Just the forward, of that our don't as linear, we linear you is

the will that year how with And pace pleased about very progression up. expect improvements full the get But how really are shaping fiscal we shaping is as as closer Thanks, overall the up we're of new quarter excited and recovery. we So sequential first to the closer do we're taper David. overall. of things

next of you’re Please question. line question your proceed Andrew Our Cowen. from the Charles comes with

the I'm through Roz And get pandemic, you. domestic from in coffee to based MSR functioning on on sales ordering can the patterns talk data. based frequently consumers likely more thank trying per argument don't in get foreseeable morning, on beverage U.S. future. higher caffeine for months observing potentially Can home what that you and [guests] be later better seem members consumption versus is what to few sizes, reverse what made that improving other to ago. capita you you about the what Great, understand observe a larger help the saw the MSR in you're consumption or work and as are with

based from described. their we're seeing changing. and work this coffee we're So consumption, from you as that their their of they're shifting home, are routines seeing customers what what in And actually patterns is on terms

from So to weekends. we're seeing, our we've morning some extremely had strong we're our morning, weekends, mid business weekday shift our to seeing a business shift

think seeing of, it I coffee is in are so more or terms so that that. what their more less And routines consumption, we're adjusting

as seeing thing The talked them seen, earlier, we're is that multiple we've beverages. Pat that by other about

consumption, it's minute maybe we of them ready that seeing to also are that for that business. So we drink two do for to in But John coffee also hard want food group to I to say in talk also might know, are a is and by and terms about orders. do family, think for and adding improving. those And

at our and the if throughout we So they're or consumer. are holding if day a retaining customer at they're retail

me bit Yes, about. a on Roz what little up talking let just pick was

packaged And business the the and in it at XX% coffee quarter that saw category we X% gains the aisle. far We are in for highlighted growth seeing U.S. grows growth. rapid Kevin in down the outpacing Starbucks shared the here

So terms Starbucks seeing the we're basis that brand XXX share more growth of we're that share points. the than grew fair in growth our getting

Starbucks across the on stable coffee addressable considerable in RTD basis in points, And XX XXX at And particular, and strong gain roasting RTD grew share cup Our points both also a at basis translates RTD XX cake gain. basis over basis points. share coffee and that then into grow share saw points at chilled XXX coffee category and our gains, ground growth there. XXX shelf we RTD

in home their is to they're it So they're us. as and consumers Starbucks turning consuming and available are shifting,

comes Stifel. O’Cull of your question question. with with line next Please from Chris Our proceed

hear has identify lot to improve or store is and you have company a using great to And But the effort? to It's how another to that use data shifted data locations. comp further and using sales? how Starbuck data Thanks. behavior consumer companies towards analyzing is that pickup the evaluate you consumer believe the company help opportunities do closures

Kevin. Yes, Chris, is this

right if convenient and we virus that for us is store of how mobile increasing, add which our to and in spreading, and is add a safety enable the described I'll we a determined characterize been familiar know experiences are protocols the shown comment channels the by around safe, it's why kind lot the community those channels us telling that increase but. then out dial level. now, a enable those per store A do for drive-thru. know artificial and up insight to ordering terms we've for. would But part what Roz order data Roz both stores, we has Clearly, if market whether convenient. open want channels of the customers or and process this of convenient looking we level, go more store me one, give along is pickup, artificial us other the COVID optimized and are of of if or consistently can time see channels are globally safe we've turn the us handheld three and we and Let tools sentiment know throughout John to then us number to window how at open and if and intelligence data can data better back Roz in we fed China, drive-thru, we in John in deployed is we we that that's the and the with we we partner pandemic a mobile the the the sale at the spread The ways and intelligence and U.S. in delivery, in familiar this clearly we behavior part curbside, And customers. at we the to near that's point that find of turn customer up mentioned do to drive-thru have a dial And that's where know on the our monitoring to to line throughput line out speed is level. we that and how or that our the helps these seating tools what do convenience, serve

us helping that across give to understand opportunities we an have we're for specific consumer experience have is we the can you behavior if the to rest and job that your and of that areas USA new to – is and us have China to across you focus want then themes growth. helping of data it first so of doing When customer we're things making where help where helps us get us data understand And progress we add. world. inform that comment. we're all, the where opportunities you So opportunity certainly on leveraging other Roz, I'll that to well, comp unlocking that focus we maybe on.

monitoring innovation recovery And beverage The give customer it's look just sales the you other area at area. are terms very an equity combining doing around do. rate and that in example, beverages, we're that the of really the growing learning is in optimizing the contributing we we that then to -- cold, fuel closely about monitoring it's our of customer around in what our fueling that, innovation the preferences we're cold work we're if you with space, that the to brand work in

doing fuel we equipment. also look So our for managing that using to ways our as innovation the new future. at of the we're We're data

the and to you when that we also new equipment about coming apply in enabled, us is online all year look is our that's at how stores allowing AI And this more labor. maintenance so over learn

in future. customer to trying actually on the different monitor so data, are performance, where the be fronts actually we will many So use to and comp improve the

Chris, all telling China about customers interact a add, perspective, the it just it's footprint, the is from we frictionless. seamless, would how us Starbucks and with and the I our their And make engage ability -- to digital is and information

rewards rewards focus on and in XXX% in level And our we so in year-over-year grew big million rewards up June, China. program at the we're members, real total a $X.X members the quarter, members now

for pandemic. order we're order pay this then or of into $XX.X the prior the addition single-digits year-over-year. that And And mobile XX% to million up grew the China. accounted assets is to up is translation quarter XX-day business. what And and Our in seeing, and versus of mobile XX% that for aspect transactions in low the delivery that to pre-COVID and

sit footprint now on continue for engage in part as introduced to we platform So And it it, delivery this all of then rapidly WeChat delivery. to well continue the gifting as we platform. well, our deploy something digital customers, WeChat social that platforms, are innovate, investing the for we to of expanded just as Alibaba’s heavily China is that we've across as and

covering in a in footprint that out our our of of building our then the really in stores all exists big XX% footprint way. So Starbucks customers. in China, program XX% delivery sits And in now China. itself

a is digital piece. big So

earlier that's The oat health we're healthy beverages, emerging good as particular, themselves. campaign And we've as this And success with other launched and having. plant from the which wellness. is year, well offerings. our piece is around our that food in for and options this success customers great the seeing you're seeing And milk, based that's thirst

And then So how the also the showing third hard brand then develop are the piece, on place team obviously, it's how environment, relevant place but how store elevate in continue to the store, store very, we still third we reserve environment, do very whether innovate up? now to around that third China. it to a is place the is our those. is continuing working are because And

the with Our line your next of question. Palmer with question ISI. comes Proceed from Evercore David

is I given and user was just rewards traffic impressive on And due thinking XX% rewards question how down growth you, XX-day COVID. Thank about was fact your to digital that was XX%. that the

on regular have of by disrupted. building stars and are understated digital is the COVID -- there because it And guess a of that users to you out or that it's lives way I connections, that's opted So lately of these course perhaps that due rewards think reservoir people working. your everyone it's for had this basis, maybe their

do a group lapsed this And on members thinking there that that are but end That that would pool is? how So you. larger of data large easy not an users? get regular you you are that of a Thank back ones. rewards of is way the it of sense have be

take to that? want you Roz,

Sure.

So data ground points just in few to there. a

and our the grew Starbucks active XX.X You're than of members that's to stated. up right September, you at end reward as million XX% more XX-day about

seeing that, able been our for occasional do before not we're what is we customer. that is we engaging have So to introduced are And that we that everyone. something stars in

now those on everyone. members we're strong innovate attract to is new what with gain stars in loyalty to very significantly seeing customers So ability and convenience growth for activation right really more in We're fiscal growth that continue the the area. XXXX early piece in that active We’ll XX-day fueling members. and of optimistic and around

to pickup down seeing broader the see. the stores, seeing is to we're we're quite whatever we we're a there. new we that And to audience we that things have introduce of of much that a One encouraged bit introduce so what by

expect do bolstered by everyone. to we So And it is stars those climb. numbers for

question Proceed RBC one your next comes with question. Capital of [Krista], Markets. with Our from

taking for Thanks Hi, question. the

attached. you the on contemplate think Pat growth versus ticket? about in earlier guidance, transaction And shifts Just food margin the that talked how in does the I

that impact there, normalization that margin yes, perhaps what's implied guidance? assuming there? And maybe there's does your So how

And thought as we've ‘XX, our fiscal about margins account course Thank the you several taken over evolution of of things. into for we the the question.

first into, is most how I earned that here it's shifting. we've our improved how sales the say and which across so rebuilding we business, ability are that the our The of further our channel are, to the drive what transactions for months down recent see we in profitability us. The and year and we is would break is that important provides then leverage average important further and to through, mix, coming how spend, implications

have of and fiscal only make that we we've thought that rebuilding of overall margin top are not that the year, So in range while range importantly, half the be end we takes this of bottom through, that substantial. the of into XX% taken investments sales the investments, in the pretty year, entire that continuing XX%, year. to the first end company how recovery, below And then of latter progression that account above to for but of the the will margin our operating into half as the for recognizing account, the we range are

really the have the pretty investments planned crisis, depths ‘XX, for heavily behind significant that invested the some business. Just of drive we as we fiscal through things our

of unlock that to So we're the strengthen key advantage what competitive starts about long-term partners. to our thinking growth. needed with is for And future points sales

offsets investments the So to And we the contributes the behind that ongoing re-grow efficiencies we've to behind well things tend incremental as our the we ongoing that finally, technology leverage extend go that sales substantial Roz and be, planned wages in as realize that and ambitions also, of planned we're our order through sustainability. Those to productivity we to and growth substantial the enhanced we in partner chain And then in gain We've investments investments and our both then operating strength digital and benefits. efficiencies. how very our in our as platform business environmental business. John as stores, supply making bold articulated. ways have

important of of ticket of mix the growth composition see a how then into we know growth, is that truly are course long-term over to the both terms in investments evolving transactions because the maintain consideration and it strengthen the those brand key points for the advantage. So competitive those necessary sales year the we taking investments to and of of

with proceed your Our Please question. of line with next of Bank to comes Gregory America. question Francfort

Or question But I the a category coffee guys to pointing the question. react the positive, look Charles's and coming that grocery flat. are back I'm Hey, coming Is Are coffee just curious, that till getting when almost modestly just Where's out little guess players? the your store coming up? the thoughts for are going over Thanks. bit I'm from independent they caffeinated chair other on differently. limited matter? moment? Americans at it shops? at thanks the from U.S. [indiscernible] business we into you're Pumpkins is service you in from?

at where Well, down has you growing growth and in go the to was thanks of coffee don't a the kind I market sheltering if home. March was to where there that coffee. of probably were back the slowed last of during investor in some period I for roughly year-after-year for going the think and was projection we market And the recall, April, at addressable data of CAGR a think on conference. people market X% coffee the the blip back of a little addressable be shared bit question. that I'll our that addressable

that we the believe you the gaining home several portion U.S. growing a our if doing growing we're the that share second are we months clearly coffee. the if the track regained home you significant coffee is share tracked think on we same-store And down when and market part on So of look data yes. over we we we've to that are The at, is from growing we've sequential going rapidly last is to probably in do share, shut at continue April. And going is answer Then the the is is for to for basis. the question is market how getting Culver gave look coffee, when aisle we in have John down that in grown I at highlighted you of we substantial when back all a stores some where our grow? comparables

are I coffee, for position, taking we that growing So we are market making the I addressable think I think area in a in investments are trade a we transformation, think and of and our beverage the done that digital in for customer have everything the a innovation growing share coffee. for tune ongoing to we are customer addressable we gains relationships, poised experience, share market

Thanks Kevin.

proceed from comes Please question Sachs. next line Goldman question. Fogertey Our Katherine with with your of

guidance provided you and the you. call It on [lots] Great, really the today. was thank helpful of that

earlier through And that said of of contemplate, kind to to way, maybe Thank these committed pull? closer be you. the revert to have even second flow might Or or, investments? you it we How the virus as levers are the XX%? kind that, year? to are consumer potentially, for strategic reasons that should for another from you research or roughly levels potential the weaken you thought believe wave the curious What there are Just spending to to here. this

this. comment, me to Pat then hand I'll over to to add let Katherine,

And my about store the First stores we embedded store those the talked they to has been now true when comments of us in what -- world. processes the of operate about resilience, developed in protocols of things in is one be run all, how believe have to that I these been for around protocols are the Starbucks our COVID. enabling operation have world we I

even how In world operationalized, curve how improvements we've where so store in that in in fact we to comparables, attribute the flattening, and those to same-store protocols, markets we've now the of COVID, our know certain increasing. other been the the see partner And we customers in what is we or relationships. safe. safe, which three turnaround elevating what know keep staying relevant true two really the drove our last this is curve the our customer years, experience, to company customer of digital the store and beverage serve And sequential our is markets, are able to and to I keep is coffee innovation customers that to over to

year. look think the could what I at unfold you what's, So if about over next

how built are Pat this that, come. feel are we're operating that And described resilience going investments I of years great investments that the said, So the know has throughout we very to this new level because to company for in that, do many to we've long-term pay confident returns of environment. to do shareholders, the investments

we We've to to positioned right world are we about significant come investments in massive flexibility growing we're value. so are the amounts But addressable in coffee. operate we are we're market gaining to adapting the game. more to a -- building of those of consumer And end quarter-to-quarter of now, company are well the having in have now it's opinion, creating have investing term us, new COVID. way we the shareholder that identified tune for long for rapidly curve shareholder for my some just we we, the behavior, that. And long want reality, shifts ahead us at adapted we out So this in positions play day, now because value versus that the of share, we this that of

the game. operating And so playing long we're

on, that if So we do the part flexibility comment of we question Now the some cost said, Pat how hit, your Pat? let side? that on things, unforeseen hey, I'll have said, much

is Texas, needed. more and the speak the to resilience whether second terms examples in have to case their gives operational work Kevin really each us much disruption U.S., authorities of as as I built like of when manage forward. operations wave well found or which so And in its and than less able well, we of with the that think in the terms severe business, just of Dalian we've the States in California, effectively in to initial said Florida going depth the the wave store ability China already, quarters, it last we've Beijing, level been we impact in local in duration. in seen that these adjust And of into as couple our of

up long-term. see pandemic, the Now, has I slow are goes impact our margin be to to best it committed CapEx, dial where described Kevin do points put that our of to absolutely position we our more as the significant our would best dial we to and to investments makes of brand ability, if will they're key the the going the would of ability our fact, spending, that value we ability expect to we position depths best the to the financial we making manage, that we balance brand make back, know as category. competitive we discretionary there unlock as in are for the us a have ensure in sense some through we those investments then to did, beyond for strengthen and And long-term, compression, the, are continue slow through ability we our to sense, strengthen did to makes sheet, have advantage, where in Starbucks essential it positioning, the the full the to but to the

your from of a UBS. comes question Please question? next with line Dennis proceed Geiger Our with

can to Great, drive drive that demand. months lot meet that about out. for curbside about Curious to new or recent of demand, cetera. has the frame operational on adjustments if the innovative opportunities know, you to to operational up adjustments handheld demand, thank been I in existing kind meet parse continued continue talked bigger the the they a opportunity whether incremental schedule of and is about sales And you et rollout to could more current shared the how, if you.

up and just kind a thinking demand, job factoring in, So even this they are two about frame with kind employees doing Thank those environment all plus stuff to, better a bit coming the could of in new these that partner's of the your we efficient components you curious have, timeline, more new kind your you. on more? being meeting existing of where curious, what if that, and

thanks. Yes, first thought. let once and you then a Roz me and go then add

Yes.

to now acceleration trade you're for what to reposition to right area we that around over So take an transformation, five accelerating of plans innovation, And planning what we're -- is we're three our the our growth. is stores had seeing particularly place that next years. doing

planning so we're you future growth. the our And for new formats coming to market, that see

productivity within more sales, but on It bringing optimize models. we're actually our us expand these margin help will so And position.

So And all that you're now lot innovation accelerated we're innovation seeing was future growth. our right bringing on forward. a moving based faster and

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Capital Please BMO the of with question final question. comes Our Andrew do to line your Strelzik, with Markets.

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concludes any this our I over for to Mr. that Johnson turn With closing the call Kevin session. remarks. will question answer and

everyone. you, thank Well,

all thank want today, conclude we for the joining us. As again call I you to

ahead. Day. forward into season along and you profit, holiday wishes and yes, about wish in XXth you next upon and leading us. December our week, peppermint us to join season way. And holiday X we and soon hope stakeholders, you future and we communicating its for transparently progress the take Happy to menu opportunity mocha talking to with year for our and virtually And is with and this of all aspirations To And look want the the exciting purpose transparency, we a company's to the committed we're that you Investor your always, end, families communicating As hosting alongside And at an our informed our you our all Halloween balancing returns all holiday can stores. virtual that. and warm our for path of our keeping forward

So going whatever we and needs. spark or ones Starbucks weeks And convenient safe, familiar ahead. for see your in your fits to where experience we holiday of at in the each curbside we you were little loved and create at bring hope at that stores our to you a to the to you window hope drive-thru or the

for thanks So joining us.

call. conference fourth concludes quarter This Coffee Company's fiscal year Starbucks and XXXX

disconnect now may You your lines.