For Starbucks (NASDAQ: SBUX), the fiscal second quarter was solid, bolstered by strong comparable-store sales growth in the U.S. and a 17% year-over-year increase in stores in China. This translated to a nice 13% year-over-year increase in non-GAAP earnings per share.
These strong quarterly results, combined with Starbucks' fiscal first-quarter results reported earlier this year, have helped the coffee giant's stock easily beat the market this year. Shares are up about 23% year to date, with the S&P 500 up 15% over the same time frame.
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To better understand what has investors so optimistic about Starbucks recently, here's a look at three key quotes from management during the company's fiscal second-quarter earnings call.
1. Digital relationships are a key growth driver
Since Starbucks started expanding its digital relationships with customers beyond active Starbucks Rewards members in 2018, these new relationships have helped fuel growth in active Starbucks Rewards members. This trend continued in fiscal Q2, Johnson said.
2. Improving customer satisfaction
In Starbucks' continuing multi-quarter effort to help employees create better customer experiences in stores, the company said it made measurable progress during fiscal Q2. Some of the ways Starbucks has helped employees make better customer connections include simplifying employees' work and reducing hours spent on noncustomer-facing tasks.
3. Starbucks' loyalty program is working in China
About four months ago, Starbucks initiated an attempt to replicate its U.S.-based success with a digital rewards program in China. Momentum with the rewards program is impressive; the company's member acquisition accelerated during the quarter, and 90-day active rewards members rose to 8.3 million. Starbucks plans to leverage this momentum by launching mobile order and mobile pay in China by the end of fiscal 2019.
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