Earnings Down as Shoppers Go Online: Starbucks CFO

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Jan. 23 (Bloomberg) –- Starbucks CFO Troy Alstead discusses Starbuck’s earnings and the possible reasons for the company’s slowing growth. He speaks to Trish Regan and Matt Miller on Bloomberg Television’s "Street Smart." (Source: Bloomberg)

Hi.

Initially, the numbers look.

When you dig a little deeper and look at comps sales, they are rough 5% veres 5.9% estimate, but in fact it looks like the americas growth, what we're seeing in the u.s., is the slowest since the first quarter of 2010. what's going on?

Why is growth slowing?

We're very pleased with the growth given the backdrop of what is happening in retail traffic.

Yes, in the americas we had a somewhat slower growth trajectory in this first quarter, the holidays, than we did coming in the last quarter.

That was all driven by december and that holiday.

It is really reflective, we believe, on what we think is a long-term, accelerating trend towards fewer people shopping in bricks and mortar and moving to online.

You are starbucks.

We cannot buy our coffee online.

You can now.

It's an important point.

You cannot get your experience from that handcrafted beverage online.

Fewer people are in the malls and other retailers, fewer people on the streets shopping there are fewer people who pop in to get a beverage.

We saw that.

We did not grow traffic in december.

Tricia brings up something interesting.

While we are on the subject of innovation and technology, i was excited when starbucks came out with the possibility to pay with my mobile phone, it was one of the first big merchants to do so.

And now there is an app, if i'm not mistaken, where you can order your copy and pick it up?

Not yet.

We are always testing.

We are a leader in mobile payments and we are always testing how to maintain that leadership position, how to offer customers technology and innovation that makes their experience better to perhaps speed up the line in the stores.

We are doing some testing in that space.

Nothing yet, but you can always count on starbucks to lead in technology and innovation.

I think you just gave him a really good idea.

But i'm sure i have read it somewhere.

Pre-k's we had a huge selloff on the street with concerns about a slowdown -- we have had a huge selloff on the street.

What are you seeing on a global level?

Are you concerned that there is, in fact, a slowdown coming?

This was her strongest global growth since 2010. this was the first time that we had global comp growth and growth in every single region at 5% or greater, first time since 2010. we are seeing very consistent growth in china.

25% growth in revenue.

5% same-store growth in europe and really moving that both top and bottom line to a record level for us.

It's very encouraging.

Do you see that continuing?

We have every confidence in what we saw in the first quarter and we see every reason to reaffirm our previous targets.

I just grabbed her notes here and she has something that says looking at possibly selling beer and wine, which i think is a great idea.

I knew you would go there.

We have about 25 stores with an evening program.

It's more than beer and wine.

It is food programs in the evening to give the customer a chance to use it when they want to and it's been a great program for us so far.

We have a starbucks in bronxville where lots of people gather there socially.

When i go there and i want a cup of coffee and my mom wants some wind, that makes sense.

-- cup of wine, that makes sense.

The lunch offering and how that's playing out.

Has that been considered a success for you guys yet?

Is a huge elevation of the food program in our stores and it extremely well.

We are about midway through the rollout and that is the full la boulange roll out.

The lunch and afternoon grew faster in terms of comp sales down did any other part of the day.

It just underscores that we have a huge food opportunity and we could not be more pleased with the results of la boulange so far.

Pretty sure you will not even need coffee -- alcohol, food.

Inc.

For joining us today, troy alstead, starbucks cfo.

This text has been automatically generated. It may not be 100% accurate.

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