Non-GAAP EPS of $0.32, down 47% from the prior year ; Starbucks® Rewards loyalty program grew to 19.4 million active members in the U.S., up 15% year-over-year ; Q2 Americas Segment Results This will position us well to continue to capture the growth opportunity we see in China in fiscal '21 and beyond. Number two, we also see digital continuing to play a bigger role, and in particular MOP and MOD, and we're going to continue to leverage that. The second difference I will say, and I think it's really obvious, is that we have this decentralized decision-making. Our breakfast sandwich business is secure. That said, our near-term focus clearly is on reopening our stores and optimizing their profitability as we emerge from the crisis and learn more about underlying customer traffic patterns and trends. Q2 Americas Segment Results In China, you're expecting same-store sales down 25% to 35% in your third quarter. That will serve us very well for the long term. Chris, just real quick on China. We expect our leverage to return to near three times rent-adjusted EBITDA in the latter part of fiscal 2021. Our Growth at Scale agenda provides the focus and discipline for us to successfully navigate this challenge. Similarly in China, I think we're also in a very strong competitive position. Could you talk about how your digital trends have kind of ramped as you've gone through April? April 28, 2020. We are also sharing our store safety protocols with our licensees across the US who continue to responsibly operate their stores, particularly in grocery locations across the country. Any such statements should be considered in conjunction with cautionary statements in our earnings release and risk factor discussions in our filings with the SEC, including our last annual report on Form 10-K and quarterly report on Form 10-Q. I know it's tough to offer global second half guidance. I will share some notable highlights from Q2 and then offer some perspective on how we expect to recover our business over time. Operator? And so the opening of stores was over a longer period of time than I think we're going to see in the US, but it was orchestrated city-by-city and almost community-by-community centrally. Ms. Doraisamy, you may now begin your conference. And with the rest of restaurants -- most of them are showing week-on-week improvement. And then maybe John can follow up on the China digital. And if we do that, I think we emerge from this strengthening the brand and strengthening the connection that we have with our customers. And for Q&A, we will be joined by Roz Brewer, Chief Operating Officer, and Group President, Americas, John Culver, Group President, International Channel Development and Global Coffee and Tea. So we are making sure that we provide a safe environment for our customers and for our partners. With Starbucks in 82 markets, we are committed to supporting our license partners around the world as they too navigate this challenge. "Based on our substantial experience in China to date, we continue to believe that the impacts of the Covid-19 outbreak are temporary and that our business will fully recover over time," the company said. With growth across all dayparts and strong contributions from both our Starbucks Rewards members and occasional customers, it is very clear that our focus on the customer experience, beverage innovation and digital customer relationships is a powerful combination. We feel confident that we've got the inventory there, and have been in close contact with all of our suppliers in that area. In fact, you were very specific on the China path. So I would say that we're operating in an abnormal position in terms of how we communicate to our customers. Starbucks had $2.57 billion in cash and cash equivalents on hand as of March 29. Sure. Starbucks Corporation (NASDAQ: SBUX) today reported financial results for its 13-week fiscal second quarter ended March 29, 2020. We're going to market and evangelize that. I will talk a little bit about breakfast as a category that we are intentionally wanting to regain as we reopen. And we work very closely with them to put together the safety protocols in our stores and how we would operate our stores going forward. Through the first 10 weeks of the quarter, the US delivered 8% comparable store sales growth, building on strong momentum from the past few quarters. We have already taken steps to enhance our financial flexibility, and that includes issuing $1.75 billion of bonds in March with the proceeds used to pay down outstanding commercial paper balances, temporarily suspending our share repurchase program, deferring certain capital expenditures and reducing discretionary spending. But we recognize coming through the COVID experience that everyone around the world is sharing that really, optimizing the initial store experience around these concepts of safe, familiar and convenient is what gets customers now to start -- that's kind of the on-ramp to that engagement. Starbucks (NASDAQ:SBUX) is scheduled to announce Q2 earnings results on Tuesday, July 28th, after market close. But we expect to begin reopening many of them next week, initially with modified operations and shorter operating hours. We'll have paid social, owned, earned media. Q2 2020 Starbucks Corp Earnings Call 04/28/2020 05:00 PM (EDT) SBUX. Now you asked about our dividend. Your first question comes from the line of David Palmer with Evercore ISI. Your next question comes from the line of Sara Senatore with Bernstein. Q2 Americas Segment Results But the scale of our company, combined with the strength of our balance sheet, enables us to manage our business for long-term growth while dealing with short-term business realities. Now certainly, we're going to know a lot more 30 days from now in the US. Good afternoon, everyone, and thank you for joining us today to discuss our second quarter fiscal year 2020 results. However, due to the rapid sales decline and significant investments in response to the COVID-19 outbreak that started to materialize in the US in mid-March, Americas Q2 non-GAAP operating margin landed at 14.4%, down from 20.3% in the prior year. I would like to welcome everyone to Starbucks Coffee Company's Second Quarter of Fiscal Year 2020 Conference Call. And our focus on the customer experience, beverage innovation and digital differentiate Starbucks and will enable us to regain the momentum we had prior to COVID-19. Thanks, John. In the US, could you talk about your store base in terms of the percentages that are in -- are not only closed today, those walk-in locations, but also areas that you would anticipate being slower to rebuild sales? Negative financial impacts are expected to moderate in the fiscal fourth quarter. And it's at approximately $125 million per week after capex but before our dividends. I'd like to start by echoing Kevin's appreciation for all of our Starbucks partners who continue to demonstrate their dedication to Starbucks and their communities in spite of hardships facing the global community right now. Starbucks (SBUX) Q2 2020 earnings: Same-store sales fall 10% April 29, 2020 admin Earnings 0 Starbucks on Tuesday said that its fiscal second-quarter global same-store sales fell 10% as the coronavirus hit sales in its two largest markets, the United States and China. Great. Pat, a question for you in terms of the outlook, at least for the second half. Perhaps you want to use China as analogy here, but what I'm thinking about the mall locations, those downtown areas or even drive-throughs that depend on commuting and highway travel, any numbers against this that would be helpful as we think about your path to recovery. Partners are the key to our resilience. And together, we are making principal decisions true to our values. This is the beginning of the recovery as we reopen stores beginning in early May, and we expect to have approximately 90% of all company-operated US Starbucks stores reopened by early June with enhanced safety protocols and modified schedules. We've adjusted in our roasting facilities for social distancing, and that's been very effective for us. Starbucks CorpÂ (NASDAQ:SBUX)Q2Â 2020 Earnings CallApr 28, 2020, 5:00 p.m. John, maybe you take green coffee sourcing. At the enterprise level, we expect the absolute flow-through impact of COVID-19 to be materially greater in Q3 compared to Q2, in particular due to the longer duration of US, Canada and Japan business disruption in Q3 compared to Q2. Get this delivered to your inbox, and more info about our products and services. Great. And I believe, if anything, the way we've navigated the virus continues to put us in a very strong position competitively. Given the global nature of our business, our ability to provide updated guidance for the remainder of the year is predicated on the current phase of COVID-19 response within each of our markets. Thank you. As a result, we are continuing to suspend formal guidance for fiscal 2020 while providing updated outlooks for selected businesses and financial metrics. Matthew DiFrisco -- Guggenheim Securities -- Analyst. ... which accounted for approximately 65 percent of total consolidated revenues in the first quarter of fiscal 2020… Your next question comes from the line of Brian Bittner with Oppenheimer. The principles we developed to drive our decision-making since the pandemic started in January are serving us well. So it's too soon to tell in terms of where the pickup will be, but we're pretty positive about the work that we have ahead of us and reintroducing our summer beverage line. So we're very encouraged with the opportunity in digital. Additionally, modifications to increase throughput in drive-through, delivery and MOP channels in our existing stores are already under way, along with a new Entryway Handoff solution, which incorporates best-in-class safety protocols. Good afternoon. We're enforcing to download the app and pick up and order ahead. I'm encouraged that we'll have 90% of the stores open. These forecasts were developed based on the most recent prevailing trends in revenue and profitability prior to the onset of material COVID-19-related business impacts, specific to each operating segment and market. And we're going to be thoughtful and responsible with each step that we take, and I think that's the formula. So that's what drove the decision to close all those stores, whereas certainly others made different decisions, and that's fine. Revenue was $519 million in Q2 fiscal '20, an increase of 16% over the prior year. Andrew, a couple of things on our roasting capacity. And now just a couple of days ago, we announced our partnership with Sequoia Capital, which we think will further accelerate our ability to leverage the digital flywheel and accelerate the pace of retail innovation as we look to partner with local tech companies and key start-ups in China. That all begins early next week. Sure. U.S. same-store sales fell 3% during the quarter, while Chinese same-store sales plunged 50% in the same period. What we've seen thus far in the month of April, we've opened seven new stores. Please proceed with your question. Just wondering if you could talk a bit more about the competitive environment, both in the US and in China, and how the Starbucks brand is positioned coming out of this, certainly depending on the situation with smaller chains and the independents, or even the larger chains in the case of China. So the acceleration of these new models that we opened, we're going to talk about them pretty broadly and loudly, and we'll know more over the next 30 days. Starbucks Earnings: SBUX Stock Falls 2% Following Q2 EPS Miss SBUX missed EPS estimates by 2 cents By William White , InvestorPlace Writer Apr 28, 2020, 4:42 pm EST April 28, 2020 And with that, Kevin and I are happy to take your questions, joined by Roz Brewer and John Culver as Durga outlined at the top of our call. Kevin Johnson -- President and Chief Executive Officer. Thank you, David. Thanks very much. You guys are somewhat insulated from protein challenges and shortages that are starting to surface. ET. Starbucks on Tuesday said that its fiscal second-quarter global same-store sales fell 10% as the coronavirus hit sales in its two largest markets, the United States and China. Durga Doraisamy - Vice President of Investor Relations Okay. Around the world, people, front-line responders, governments and businesses are all navigating extraordinary times. And so we -- we learn from China and then just expanded that work and then looked at government and local health officials and what they were saying. Q2 Earnings Reveals an Ugly Consumer Economy for Starbucks Competition and belt-tightening could hurt SBUX stock By Josh Enomoto , InvestorPlace Contributor May 1, 2020, 1:59 pm EDT May 1, 2020 We believe the focused actions we are taking to deliver a contactless customer experience, coupled with continued beverage innovation and expanded digital capabilities, will help to restore the upward momentum in our US business that we were experiencing prior to the onset of COVID-19. Catastrophe pay for baristas, hourly pay increases and the cost of store safety items such as face coverings weighed on profits during the quarter. And the most important thing is to let them know that we are open. So why don't you go ahead first, Roz? And we're seeing that over the last week or so. In the second quarter, we had between two and three weeks impacted by COVID-19 outbreak. But I would say that we're optimistic that given the shape of the recovery curve going into next year, that our capital spending programs, which underpin so much of our growth, we would expect to normalize next year. In Q2, this segment's revenue grew by 16%, which includes a 5% favorable impact primarily related to the Global Coffee Alliance transition-related activity, boosting our share of the coffee market outside of specialty retail. Your next question comes from the line of David Tarantino with R.W. Our performance was obviously disrupted by the impacts of COVID-19 but we are confident that the Starbucks brand is well positioned and that our Growth at Scale agenda remains intact, and will propel future growth when we emerge from this current crisis. But given the late quarter onset of COVID-19 impacts in the US as well as a materially higher flow-through rate on lost sales in the US, we do expect the negative financial impacts of COVID-19 to be significantly greater in Q3 compared to Q2, and to extend into Q4. Share; Tweet. And so with the amount of cash currently available to us, and that includes our existing credit facilities and additional borrowing capacity if we need it, we're comfortable with our overall liquidity position and we're well prepared to manage current operating conditions from a cash flow perspective. And that includes the investments in interim partner wages and benefits, which we've extended through the end of May. Yes. Our top priority and our near-term goal is to return to cash positive store operations and to improve from there toward full recovery, and we will do that by reopening large numbers of stores and improving their profitability, including normalizing store partner pay practices starting in May. Thanks for the question. Your next question comes from the line of Andrew Charles with Cowen. We believe, barring any new disruptions, that our business in China is on a path to substantial recovery by the end of this fiscal year. Please proceed with your question. Thanks. We believe that these highly resilient customers will come back to us. First, through salary and wage continuation and through premium pay for those working on the front lines of our business, both as communicated through the end of May, we are investing in our partners who are critical to the Starbucks Experience and instrumental to our long-term success. That's something that we learned from China. In the third quarter, for all intents and purposes, we're expecting 13 weeks of impact, most significant in the month of April, but reduced in the months of May and June as we reopen our stores and normalize our pay practices. Please proceed with your question. But you have given us some April color. We have the financial strength to make investments for the long term as we navigate challenges in the short term. Since we started reopening stores in late February, we have seen meaningful improvements in China comparable store sales in commercial, residential and office locations. Sharon Zackfia -- William Blair -- Analyst. And I think 30 days from now, we're going to have a much clearer view of how rapidly that goes. And so we had done a significant amount of work to actually relieve the partner of a lot of their tactics they were doing in the stores, and they were engaging with our customers in some of the most meaningful ways. For me, I think the comment I would make was, in China, it was -- decisions were made centrally by central government on a city-by-city basis, and even certain office parks and things were actually coordinated when they opened. The coffee company reported $0.51 earnings per share for the quarter, topping analysts' consensus estimates of $0.31 by $0.20. Let me just comment on the part of your question, then I'll hand it over to Pat. And that's, again, largely due to an extended duration of impact in the third quarter. So you'll see those reignited with a lot more energy than in past. Starbucks expects that same-store sales in China will decline between 15% and 25% in fiscal 2020, as sales continue to rebound in the second half of the fiscal year. Your next question comes from John Ivankoe with JP Morgan. Starbucks stores that remain closed in China are primarily located in cinemas and enclosed entertainment venues, along with the international travel hubs and certain tourist zones where restrictions are still in effect. And so by augmenting the in-store experience with mobile ordering and contactless pickup, we can service significant volume of customers without having the cafe seating area actually opened. It was just three weeks ago, in the spirit of continued transparency when Pat and I shared with all stakeholders our second intra-quarter update on how COVID-19 has impacted our business and how we are responding. So one of the things I'll highlight, and John Culver alluded to it earlier, is a different habit between China and the US. We're falling into line there and really going to open our stores. Yeah. In relation to the $915 million of consolidated revenue impact that I mentioned earlier, this equates to approximately 80% of flow-through on lost revenue, which is materially higher than the 50% variable flow-through rate that we typically observe in our business, reflecting the significant investments we've made in the short term to support our partners and manage our brand for the long term. Our next dividend is payable on May 22 to shareholders of record on May 8. We continue to navigate through this unprecedented situation, staying true to our mission and values, and I'm pleased with where we are. Thanks very much for the transparency. But based on what we see today, including our expectation that sales will start to recover as we come out of the third quarter into the fourth quarter into next year, I would say at this stage, we would expect capex to normalize in fiscal 2021. In the US, almost 60% of our company-operated stores include drive-through and over 80% of our customer occasions before the crisis were on the go, with the majority of these orders being placed at the drive-through or by using the Starbucks app to mobile order for pickup or delivery. But it's still early for us for delivery overall. Thank you. At Starbucks, the third place has always been about community, connection and convenience. We remain confident in our approach. Roz, why don't I have you respond as it relates to digital and US and safety protocols? We've increased to over 19 million of those customers in the US, up 15% a year ago. Due primarily to the deferral of some new store openings and store refurbishments, we now expect capital expenditures for fiscal 2020 to total approximately $1.5 billion, or $300 million lower than our original plan prior to the onset of COVID-19. And so we are seeing people come back into the cafes and sit there, albeit not to the levels that we saw pre-COVID. Roz, why don't you share a little bit more about the plans that you see unfolding over the next 30 days? The response from customers has been great. We take a look at the 2nd quarter 2020 earnings report of Starbucks, one of the world's best known coffee shop franchises. So we've not yet confirmed those arrangements, and it's really premature to indicate what that relief may look like, but it is something that we are pursuing. Just trying to make sure there aren't any outliers in terms of rest of the year 2020 or 2021 modeling. Earlier this month, the company withdrew its fiscal 2020 forecast, citing the "dynamic nature" of the coronavirus crisis. We just decided rather than have any location that has a cafe opened during the period where the nation was sheltering at home and social distancing, we thought that was the safest way for us to ensure both our partners' safety as well as out of our customers. Thanks for the question. Thank you, John. Traditionally, we've seen 80% of our business be stay in and enjoy their drinks in the cafes. Also Starbucks is the first in China to offer national distribution of beyond meats, plant-based proteins with new Asian menu items served in packaging made from plant-based materials. I would presume that you're going to expect those not to open up at 75% indexing pre-COVID May 1, as those probably were closed for reasons and employment not being back. Thanks. Thanks. The company plans to add curbside pickup later this summer, COO Roz Brewer said. We anticipate the 80% of where we were pre-COVID will come back. Similar to our experience in China, we are transitioning into a new phase of operations we call monitor and adapt. We're now moving into South America, into Brazil and Colombia. And our Channel Development business is posting very strong results and acting as a brand amplifier. So our intention today is to continue to pay our quarterly dividend. Great. Consistent with the approach we have taken in our two interim update this quarter, we will provide transparent updates as to what we are seeing and how that shapes our perspective on the balance-of-year financial results as we execute our store reopening plan and have increased visibility into business performance trends in the US and other markets. And in those 30 stores, there'll be no seating. As Kevin discussed, China, our second largest market, is in the recovery phase, which enhances our ability to estimate balance of year results. Second, by extending more flexible development and financial terms in Q3, we are investing in our international licensees who are our partners in driving long-term growth. These items are excluded from our non-GAAP results. It's a little bit more pronounced in the morning, but that's to be expected because the routine have been disrupted. And through our principled actions, we have strengthened the trust and confidence of both our partners and our customers have in Starbucks. As Starbucks really does differentiate itself with the cafe experience and the third place experience. The fact that while serving their communities, they also served over 1 million free cups of coffee to the front-line responders who have worked tirelessly to care for others, which makes us all very proud. We had a peak in early February of 80% early on. Please proceed with your question. In terms of food sourcing, there's a lot of activity happening in proteins. And if there is a silver lining, I think it is forming a new habit in China, where you are seeing more people take to-go orders and get used to doing that. Starbucks Corporation (NASDAQ: SBUX) today reported financial results for its 13-week fiscal second quarter ended March 29, 2020. These impacts first started in China in late January and materialized in other markets later in the quarter. And clearly, the posting an 8% comp with 4 points of transaction growth in the US in the first -- up until the last two weeks of March, was clearly an indication that, I think this combination of the in-store experience, beverage innovation and digital customer relationships was putting us in a position where we were, I think, growing share of the customer occasions at specialty coffee retail. Thanks. So that alone is going to create a difference. And I hope you're all staying safe. Global same-store sales declined 10%, as overall transactions sank 13%. 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