Starbucks Corporation · NASDAQ:SBUX
Starbucks — Investor Day (November 2023)
101 slides from Starbucks's investor day presentation, Nov 2, 2023
Slide 1: 2023 Reinvention Update and Holiday Launch
Gio ip 2a) es 2023 REINVENTION UPDATE AND HOLIDAY LAUNCH
Slide 2: Forward-Looking Statements
Forward-Looking Statements The following presentations contain forward-looking statements. Forward-looking statements are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements and should be considered in conjunction with cautionary
Slide 3: Tiffany Willis
Tiffany Willis vice president, head of investor relations & esg engagement 2 Year Partner
Slide 4: Heritage
VIDEO Heritage
Slide 5: Laxman Narasimhan
Laxman Narasimhan chief executive officer 1 Year Partner
Slide 6: Ret el!
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Slide 7: Slide 7
Slide 8: FY23 financial results & FY24 guidance summary
FY23 financial results & FY24 guidance summary FY23 FY24 RESULTS GUIDANCE Comp Growth 8% 5–7% Revenue Growth 12% 10-12% Earnings Growth 20% * 15–20% * Non-GAAP figure. Please refer to “Reconciliation of Selected GAAP Measures to Non-GAAP Measures” on our IR website, Starbucks 2023 Reinvention Update
Slide 9: Ret el!
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Slide 10: Slide 10
Slide 11: Our Mission
VIDEO Our Mission
Slide 12: Our Mission
O U R M IS S IO N With every cup, with every conversation, with every community— we nurture the limitless possibilities of human connection.
Slide 13: Our Promise: When we're at our best, we…
OUR OUR PARTNER CUSTOMER PROMISE PROMISE Bridge to a Uplift the better future everyday O U R P R O M IS E OUR OUR SHAREHOLDER FARMER PROMISE PROMISE When we’re at Generate enduring, Ensure the future long-term returns of coffee for all our best, we… OUR OUR ENVIRONMENTAL COMMUNITY PROMISE PROMISE Gi
Slide 14: Our Promise
VIDEO Our Promise
Slide 15: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 16: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 17: Kyoto Heritage
KYOTO HERITAGE NINEIZAKA YASAKA CHAYA KYOTO BAL CURATED WITH KOHEI NAWA KYOTO UJI BYODOIN OMOTESANDO
Slide 18: Kyoto BAL curated with Kohei Nawa
KYOTO BAL CURATED WITH KOHEI NAWA
Slide 19: Sara Trilling
Sara Trilling executive vice president and president of Starbucks North America 21 Year Partner
Slide 20: Slide 20
Slide 21: U.S. store sales continue growth
U.S. store sales continue growth U.S. COMPANY-OPERATED AVERAGE WEEKLY SALES 50% GROWTH FY19 FY23
Slide 22: Purpose defined stores expect to guide 4% annual store growth
Purpose defined stores expect to guide 4% annual store growth on a base of over 16,000 FROM EXPANDING TO WALK UP AND DRIVE THRU DRIVE THRU DRIVE THRU CAFÉ CAFÉ DRIVE THRU ONLY PICK-UP
Slide 23: Digital ordering continues its growth
Digital ordering continues its growth U.S. COMPANY-OPERATED STORES MOP & DELIVERY GROWING 31% OF SALES in Q4 FY23 ~30% IN ONE YEAR
Slide 24: Current formats remain important to our strategy
Current formats remain important to our strategy
Slide 25: Operational excellence will drive sales growth
Operational excellence will drive sales growth SIREN SYSTEM NEW OVENS CLOVER VERTICA COLD BREW COLD FOAM Single Source of Store Metrics
Slide 26: Brady Brewer
Brady Brewer executive vice president, chief marketing officer 22 Year Partner
Slide 27: Slide 27
Slide 28: All dayparts driving growth
All dayparts driving growth NORTH AMERICA COMPANY-OPERATED STORES HOT BREAKFAST HOT BREAKFAST CATEGORY GROWTH CATEGORY GROWTH ~$3B ~$6B 20% 26% TOTAL HOT BREAKFAST SALES TOTAL FOOD SALES IN FY23 IN FY23 IN AFTERNOON DAYPART IN FY23 C
Slide 29: Driving beverage platform growth through our core and innovation
Driving beverage platform growth through our core and innovation NORTH AMERICA COMPANY-OPERATED HOT ESPRESSO % of net store sales 10% RETURNING 85% FAVORITES CORE PLATFORMS 5% ICED ESPRESSO NEW PLATFORM INNOVATION TEA STARBUCKS FRAPPUCCINO STARBUCKS REFRESHERS
Slide 30: Food sales are approaching $6B with more opportunity
Food sales are approaching $6B with more opportunity NORTH AMERICA COMPANY-OPERATED STORES ~$6B TOTAL FOOD SALES IN FY23
Slide 31: We are committed to give more than we take from the planet
We are committed to give more than we take from the planet
Slide 32: Triple Shot Reinvention: Elevate the Brand
TRIPLE SHOT REINVENTION 1 Elevate the Brand • Run great stores through better operations • Build more purpose-defined stores and accelerate renovations • Continue our proven track record of product innovation
Slide 33: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 34: Our Digital Ambition: Know every customer
O U R D IG IT A L A M B IT IO N Make the Know Personalize Starbucks every their experience customer experience effortless ACROSS ALL CHANNELS GLOBALLY
Slide 35: Achieving the digital ambition
Achieving the digital ambition + = Convenience Connection Care
Slide 36: Customers seek convenience
Customers seek convenience Similar items
Slide 37: Direct digital relationships with hundreds of millions of customers
Starbucks has direct digital relationships with hundreds of millions of customers 3X POTENTIAL CUSTOMERS WE CAN ENGAGE WITH DIGITALLY 75M+ 90-DAY ACTIVE GLOBAL STARBUCKS REWARDS MEMBERS
Slide 38: We will again double our Starbucks Rewards Members within 5 years
We will again double our Starbucks Rewards Members within 5 years NEW! NEW! LEADING FINANCIAL WORLD CLASS INSTITUTION PARTNER HOSPITALITY PARTNER
Slide 39: Creating customer connection
Creating customer connection CONTENT COMMUNITY
Slide 40: Deb Hall Lefevre
Deb Hall Lefevre executive vice president, chief technology officer 1 Year Partner
Slide 41: Slide 41
Slide 42: Extending our innovation lab with Microsoft
Extending our innovation lab with Microsoft to accelerate product development and personalization
Slide 43: Launching our first Partner Innovation Store
Launching our first Partner Innovation Store to experiment and improve tech for our partners around the world
Slide 44: Reimagining the customer in-store experience
AMAZON STORE Reimagining the customer in-store experience with new Amazon One and Just Walk Out technology
Slide 45: Triple Shot Reinvention: Strengthen and Scale Digital
TRIPLE SHOT REINVENTION 2 Strengthen and Scale Digital • Accelerate digital feature releases • Expand customer reach, helped by new Reward program partnerships • Capitalize on Deep Brew and the tech architecture shifts in collaboration with tech pioneers
Slide 46: Michael Conway
Michael Conway group president, International and Channel Development 10 Year Partner
Slide 47: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 48: Starbucks has only just begun to capture the global opportunity
Starbucks has only just begun to capture the global opportunity TODAY, INTERNATIONAL AND CHANNEL DEVELOPMENT IS: 85% >50% ~1/3 GLOBAL CUSTOMER OF TOTAL OF STARBUCKS TOUCHPOINTS STORE COUNT PROFIT GROWTH OUR AMBITION IS MUCH GREATER
Slide 49: Channel Development
Channel Development
Slide 50: Channel Development is significantly increasing customer touchpoints
Channel Development is significantly increasing customer touchpoints AT-HOME COFFEE GLOBAL READY TO DRINK FOODSERVICE #1 IN U.S. Innovating and 33,000 Accelerating with locations globally Strong Partners Celebrating 5 years with Nestlé Reaching new customers US AHC SHARE / CONSUMPTION (MULO rolling
Slide 51: International expected to drive store growth
International expected to drive store growth over next 3 years 20,000 th 10% STORE OUTSIDE OF THE U.S. ANNUAL GROWTH BATTERSEA POWER STATION, LONDON, UK PUNTA CANA, DOMINICAN REPUBLIC
Slide 52: International licensed stores continues strong momentum
International licensed stores continues strong momentum 3 out of 4 EXPECTED NEW STORES GLOBALLY OUTSIDE OF THE U.S. PANAMA THAILAND INDIA
Slide 53: International licensed stores continues strong momentum
International licensed stores continues strong momentum STARBUCKS REVENUE PER LICENSED STORE 26% GROWTH PER STORE SINCE PRE-COVID FY19 FY23
Slide 54: Yangpyeong, Gyeonggido, South Korea
YANGPYEONG, GYEONGGIDO, SOUTH KOREA
Slide 55: Company-operated markets thriving
Company-operated markets thriving TOGANE, JAPAN LONDON, UK
Slide 56: Clatterbridge Drive-Thru, Braintree, Mansfield
CLATTERBRIDGE DRIVE-THRU BRAINTREE-GALLEYS CORNER MANSFIELD DRIVE-THRU SHOREDITCH HIGH STREET, LONDON
Slide 57: Ise Naikumae, Kokyo Gaien, Wadakura Fountain Park
ISE NAIKUMAE, ISE KOKYO GAIEN WADAKURA FOUNTAIN PARK, TOKYO
Slide 58: Belinda Wong
Belinda Wong chairwoman and co-chief executive officer, Starbucks China 23 Year Partner
Slide 59: Omni-channel business offering full spectrum of experiences
Omni-channel business offering full spectrum of experiences IN STORE DELIVERY ON-THE-GO MERCHANDISE & GIFTING AT HOME WE PROUDLY SERVE
Slide 60: Huge head room for future growth
Huge head room for future growth RISING MIDDLE CLASS VAST WHITE SPACE # of middle class population1 (million) # of county level cities and Starbucks coverage 700 ~3,000 450 1.5x ~500 800+ 2022 2030E FY19 FY23 Total China Coverage Coverage INCREASING ADOPTION INCREASING FREQUENCY % of consumers who d
Slide 61: Locally relevant beverage innovation
Locally relevant beverage innovation GLOBAL PLATFORMS ADAPTED TO CHINESE TASTE CHINESE INSPIRED CREATIONS
Slide 62: Multiple levers to drive growth
Multiple levers to drive growth DAYPART AND FOOD DELIVERY EXPERIENCE INNOVATION
Slide 63: Building strategic capabilities through digitalization
Building strategic capabilities through digitalization STARBUCKS CHINA COFFEE INNOVATION PARK STORE OPERATIONS ROASTING PLANT INTEGRATED DISTRIBUTION CENTER AI-ENABLED SUPPLY CHAIN AND STORE OPERATIONS ~30% ~15% ~50% ~15 % LABOR PRODUCTIVITY RETAIL LOGISTIC COST WASTAGE AS % STORE OPERATING AT LIKE-
Slide 64: Expect to operate 9,000 stores by 2025
Expect to operate 9,000 stores by 2025 ~20% NEW STORE INVESTMENT2 C <2 years ROASTERY & RESERVE SOCIAL/COMMUNITY NEW STORE PAYBACK 2:1 C SALES TO INVESTMENT RATIO URBAN INFILL STARBUCKS CARAVAN 1 1. Excluded from store counts 2. Comparison from FY19 to FY23
Slide 65: Triple Shot Reinvention: Become Truly Global
TRIPLE SHOT REINVENTION 3 Become Truly Global • Expand to 35,000 stores by 2030 outside North America • Extend Starbucks Digital integration across the globe • Drive nearly 1/3 of future earnings growth
Slide 66: Sara Kelly
Sara Kelly executive vice president, chief partner officer 22 Year Partner
Slide 67: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 68: Reinvention investment driving momentum and margin expansion
Reinvention investment driving momentum and margin expansion INVESTMENT MARGIN EXPANSION total in billions OPEX CAPEX ~$4 ~$3 +100 ~$2 BPS* FY21 FY22 FY23 OPEX AS % OF PROFIT ~10% ~20% ~20%+ * Non-GAAP figure. Please refer to “Reconciliation of Selected GAAP Measures to Non-GAAP Measures” on our IR
Slide 69: We are consistently investing in our partners
We are consistently investing in our partners PARTNER EXPERIENCE BLUEPRINT Investing in your journey Supporting • Pay and benefits you on the job • Personalized career path • Training • Great retail leaders • Equipment and store standards • Tools • Scheduling Creating positive impact, together • Cel
Slide 70: U.S. store partner income expected to double by FY25
U.S. store partner income expected to double by FY25 BARISTA CASH COMPENSATION Nearly 40% 2X GROWTH Since 2020 ~50% GROWTH FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 1. AHPP projections based on PCS Program plan for FY24/25 2. Hourly wage data for FY22+ based on full year-average; due to data availab
Slide 71: Unlocking the partner experience through an evolving blueprint
Unlocking the partner experience through an evolving blueprint Supporting Investing in Creating positive you on the job your journey impact, together • Scheduling to fit my life • Competitive pay • Elevated coffee • Digital engagement • Differentiated benefits & craft experience • Financial wellness
Slide 72: Rachel Ruggeri
Rachel Ruggeri executive vice president, chief financial officer 20 Year Partner
Slide 73: Reinvention momentum driving efficiency
Reinvention momentum driving efficiency $ in millions IN STORE OUT OF STORE OTHER WASTE MANUFACTURING SOURCING DISTRIBUTION STAFFING & SCHEDULING EQUIPMENT & WORKFLOW
Slide 74: Reinvention momentum driving investment and margin expansion
Reinvention momentum driving investment and margin expansion REVENUE, STORE OPEX + COGS total in billions REVENUE 12% REVENUE GROWTH STORE OPEX + COGS 7% 9% REVENUE CAGR COST GROWTH 8% COST CAGR FY19 FY20 FY21 FY22 FY22 FY23
Slide 75: Reinvention momentum driving efficiency
Reinvention momentum driving efficiency $ in millions IN STORE OUT OF STORE $3B OTHER WASTE MANUFACTURING SOURCING DISTRIBUTION STAFFING & SCHEDULING EQUIPMENT & WORKFLOW
Slide 76: Reinvention momentum driving efficiency
Reinvention momentum driving efficiency $ in millions IN STORE OUT OF STORE $3B OTHER WASTE MANUFACTURING SOURCING DISTRIBUTION STAFFING & SCHEDULING EQUIPMENT & WORKFLOW $2B
Slide 77: Progressive margin expansion
Progressive margin expansion Progressive Margin Expansion + - Sales Leverage Investments FUTURE COGs MARGIN Store OpEx G&A CURRENT MARGIN
Slide 78: Unlock Efficiency
WITH TWO PUMPS 1 Unlock Efficiency • Unlock $3B in efficiencies with $2B out of the store • Target investments across our partner & customer experience • Progressively expand margin
Slide 79: Our Values
VIDEO Our Values
Slide 80: Our Values
OUR VALUES Craft Results Courage Belonging Joy
Slide 81: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
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Slide 83: Starbucks and the arts
VIDEO Starbucks and the arts
Slide 84: Slide 84
Slide 85: Slide 85
Slide 86: Restaurant & Bar
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Slide 87: Dave Baillie, Illustrator & Muralist
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Slide 91: Our Mission, Promises, Strategic Priorities and Values
OUR MISSION With every cup, with every conversation, with every community– we nurture the limitless possibilities of human connection. OUR PROMISE OUR PARTNER OUR CUSTOMER OUR FARMER OUR COMMUNITY OUR ENVIRONMENTAL OUR SHAREHOLDER PROMISE PROMISE PROMISE PROMISE PROMISE PROMISE Bridge to Uplift the
Slide 92: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture
Slide 93: Strategy
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 STRATEGY Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture • Run great stores • Accelerate digital • Expand to • Unlock $3B • Further through better feature releases 35,000 stores in effi
Slide 94: Outcomes
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 OUTCOMES Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture • Higher customer • Double SR • 55,000 • $3B in • Partner connection members stores globally efficiency sentiment improvement •
Slide 95: Triple Shot with Two Reinvention Pumps
TRIPLE SHOT WITH TWO REINVENTION PUMPS 1 2 3 1 2 Elevate the Strengthen and Become Unlock Reinvigorate Brand Scale Digital Truly Global Efficiency Partner Culture CUSTOMER GLOBAL SR GLOBAL PROGRESSIVE PARTNER CONNECTION 90-DAY STORE MARGIN ENGAGEMENT ACTIVE COUNT EXPANSION DOUBLE 55,000 $3B IN MEMBE
Slide 96: Our Shareholder Promise: Generate enduring, long-term returns
OUR SHAREHOLDER PROMISE: GENERATE ENDURING, LONG-TERM RETURNS FY23 FY24 Long-term Results Guidance Algorithm COMP GROWTH 8% 5–7% 5%+ REVENUE GROWTH 12% 10-12% 10%+ EARNINGS 20% 15–20% 15%+ * GROWTH * Non-GAAP figure. Please refer to “Reconciliation of Selected GAAP Measures to Non-GAAP Measures” on
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Slide 98: Laxman Narasimhan and leadership team
Laxman Narasimhan chief executive officer 1 Year Partner Brady Brewer Frank Britt Michelle Burns Michael Conway AJ Jones II Sara Kelly executive vice president, executive vice president, executive vice president of global group president, international and executive vice president and chief executiv
Slide 99: Slide 99
Slide 100: Christmas
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Slide 101: © 2023 Starbucks Corporation. All rights reserved.
© 2023 Starbucks Corporation. All rights reserved.