Starbucks (NYSE:SBUX) on Thursday reported a strong quarter that beat estimates and said it plans to further its reach with 1,500 new locations internationally by the end of the year and a slew of new menu options.
The cult-favorite coffee chain plans to bring made-to-order Fizzio handcrafted carbonated beverages to 40 percent of its U.S. stores this summer. The company is reportedly in talks with carbonated-beverage company SodaStream to also offer more new beverages. New lunch items will also be introduced, with some salads and sandwiches already being tested, the company said. Starbucks is looking to expand its food menu to bring in customers who normally wouldn't visit during their lunch hour.
This is the second menu update from Starbucks this year. In March, Starbucks announced it will extend its post-4 p.m. Evenings Menu to thousands of stores nationwide as it tries to attract more consumers in the evening, a typically slow time of day for the coffee shops. After several years of testing beer and wine offerings, Starbucks also plans to roll out alcoholic beverages in the evening to shops nationwide over the next few years.
The company has been diversifying in recent years from its traditional coffee business by adding more packaged products and food. It recently acquired tea retailer Teavana and San Francisco bakery La Boulange, while also partnering with Danone SA last year to sell Greek yogurt parfaits and other items.
As menu options expand, so too, will the store count. This year, Starbucks plans to add another 1,500 locations, including 600 in the Americas.
"We are significantly under-stored in many markets, including North America," CEO Howard Schultz said in an earnings call. He also added that drive-through locations offered particular promise.
Earlier this week, Starbucks said it is planning to bring the first full-service La Boulange Bakery to Los Angeles. This will be the chain's first expansion outside of San Francisco, where it currently operates 22 locations. Starbucks purchased La Boulange Bakery in 2012.
Starbucks earned second quarter revenue of $3.9 billion, up 9 percent from the same period last year. The coffee chained reported a profit $427 million up 9 percent from $390 million a year earlier. Same store sales rose 6 percent.
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