13-Sep-2022 Starbucks Corp.
Corrected Transcript
13-Sep-2022
Starbucks Corp. (SBUX)
Investor Day - Morning Session
1-877-FACTSET
Total Pages: 68
Copyright ? 2001-2022 FactSet CallStreet, LLC
Starbucks Corp. (SBUX)
Investor Day - Morning Session
Corrected Transcript
13-Sep-2022
CORPORATE PARTICIPANTS
Tiffany Willis
Vice President, Head of Investor Relations, Starbucks Corp.
Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Howard D. Schultz
Interim Chief Executive Officer & Director, Starbucks Corp.
Laxman Narasimhan
Incoming Chief Executive Officer & Member-Board of Directors, Starbucks Corp.
Sara Kelly
Chief Partner Officer & Executive Vice President, Starbucks Corp.
Frank F. Britt
Executive Vice President, Chief Strategy & Transformation Officer, Starbucks Corp.
Brady Brewer
Chief Marketing Officer & Executive Vice President, Starbucks Corp.
John Culver
Group President, North America and Chief Operating Officer, Starbucks Corp.
Sara Trilling
Executive Vice President and President of Starbucks North America, Starbucks Corp.
Jaelyn Proctor
Tryer Lab Partner, Starbucks Corp.
Lisa Koss
Lab Ops, Tryer Center for Innovation & Barista Trainer, Starbucks Corp.
Heather Munro
Tryer Lab Partner, Starbucks Corp.
Tim Miranda
Laboratory Operations Manager, Starbucks Corp.
Belinda Wong
Chairwoman-Starbucks China, Starbucks Corp.
Michael A. Conway
Group President of International and Channel Development, Starbucks Corp.
Alberto Torrado Mart?nez
Chairman, Alsea SAB de CV
John Hadden
Chief Executive Officer, Alshaya Group
David Song
Chief Executive Officer, Starbucks Coffee Korea Co., Ltd.
Chanda Beppu
Vice President - Global Channel Development, Starbucks Corp.
Deborah Hall Lefevre
Chief Technology Officer & Executive Vice President, Starbucks Corp.
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Copyright ? 2001-2022 FactSet CallStreet, LLC
Starbucks Corp. (SBUX)
Investor Day - Morning Session
Corrected Transcript
13-Sep-2022
MANAGEMENT DISCUSSION SECTION
Unverified Participant
Forward-looking statement. 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 statements and risk factor discussions in our filings with the SEC, including our most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. Starbucks assumes no obligation to update any of these forward-looking statements or information, which are made as of their respective dates.
Non-GAAP financial measures. Certain financial measures included in this presentation are not measures of financial performance under US generally accepted accounting principles, GAAP. Certain non-GAAP measures were not reconciled to the comparable GAAP financial measures because the GAAP measures are not accessible on a forward-looking basis. The company is unable to reconcile these forward-looking non-GAAP financial measures to the most directly comparable GAAP measures without unreasonable efforts, because the company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures for these periods, but would not impact the non-GAAP measures. Such items may include acquisitions, divestitures, restructuring and other items.
The unavailable information could have a significant impact on the company's GAAP financial results. References in today's presentations are on a non-GAAP basis, unless otherwise noted, or if there's no non-GAAP adjustment related to the metric. Reconciliations for the non-GAAP measures to their corresponding GAAP measures can be found in the appendix to this presentation.
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Tiffany Willis
Vice President, Head of Investor Relations, Starbucks Corp.
Good morning. I'm Tiffany Willis, Vice President and Head of Investor Relations here at Starbucks. And on behalf of our leadership team, we welcome you to our 2022 Investor Day. Now before we shift into our presentations, allow me to cover just a few housekeeping items, such as our forward-looking statements that we made available at the beginning of this meeting for everyone to reference. And second, I would like to share our agenda for the day. And as you'll see, we have an action packed day brewed just for you. Now, you may be wondering, wow, this is long. But don't worry, we have plenty of coffee, okay? And then third, for everyone joining us virtually online, you'll be able to follow these presentations and they'll also be made available through our website for everyone to access throughout the day.
Now with that, let's get this show started in a way that only Starbucks knows how, and that's through our coffee tasting. So please help me welcome Michelle Burns, Demetrius Brown, and Nitia Hassell to the stage.
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Good morning, everyone. As Tiffany shared, my name is Michelle Burns, and I lead our Global Coffee team here at Starbucks. I am so honored to be here today. And I believe the last time that I was with this community, we're in New York. So welcome to Seattle and it's great to have you back. You're in for a great day. I'm honored this
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Copyright ? 2001-2022 FactSet CallStreet, LLC
Starbucks Corp. (SBUX)
Investor Day - Morning Session
Corrected Transcript
13-Sep-2022
morning also to be standing alongside two of my Starbucks partners, Nitia and Demetrius. So over our most sacred rituals at Starbucks, one of them is always connecting over coffee. Our tradition has often been tasting hot coffee, the highest quality, ethically sourced arabica coffees from all over the world as we have done for over 50 years. Well, I'm also here to tell you that all that care and quality continues. But it's a new day. And the fact is, cold is hot. So today, we're really proud to share with you a future cold beverage that we will be tasting in just a bit.
But before we do that, Demetrius, I'd love to invite you to introduce yourself and tell us a little about you.
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Unverified Participant
Thank you. My name is Demetrius Brown. I'm a 4.5-year partner at Kent Flexible Plant, where I'm currently Plant Lead. The highlight of my day really is bringing in coffee from all over the world from the farmers, roasting it till its own certain character and profile, and then shipping it off to Nitia and all the green aprons in the store, which I'd really love to thank the green aprons. They're out there on the frontlines every day. And without them, there's no me, manufacturing, or distribution. Whether it's cold brew or our journey, I'm really excited for tomorrow.
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
All right. Awesome. Thank you, Demetrius. And give it up for Demetrius and his green apron. You're bringing a little flash. And Nitia, who for the very first time today is wearing her black Coffee Master apron, so congratulations. Nitia, tell us a little bit about yourself.
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Unverified Participant
First. Thank you, Demetrius and all the roasting plant partners because we in-stores can do what we do and serve our customers if it was not for you all, so I'm appreciative of that. Hi, friends. I'm Nitia Hassell. I am almost eight-year partner. I started in the Chicago area and I moved to Seattle in 2016 and I worked at various stores throughout Seattle. Currently, I work at our heritage store in Pike Place Market, at the very first Starbucks store. So I have the unique opportunity to welcome all of our guests from, like, across the world and share coffee and culture and a little bit of like the store, company history with them. Yeah.
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Yeah. Awesome. Thank you. And Nitia and I both share starting in Chicago. Her, eight years ago. Me, 28 years ago. So it just kind of goes to show the beauty of this company and the expansion of what we do. Now, we created Cold Brew in 2015 and brought the best of flavor and heritage of Starbucks to our customers as a new cold coffee offering. And it has been growing ever since with the launch of Nitro in 2017, and then the incredibly favorable and favorite Cold Foam in 2018. But maybe instead of telling you all about it, let's all have a taste of this fantastic beverage that will be coming out in the winter.
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Unverified Participant
All right. So we'll take a couple seconds. And as the coffee is coming out ? yeah. There it comes. There it comes.
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Copyright ? 2001-2022 FactSet CallStreet, LLC
Starbucks Corp. (SBUX)
Investor Day - Morning Session
Corrected Transcript
13-Sep-2022
Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Yeah. Here come our green apron partners.
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Unverified Participant
All right.
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Right on. Thank you. And now, while they're passing, our commitment to craft and great tasting coffee truly remains our ultimate responsibility. As I mentioned earlier, cold is hot. In fact, two-thirds ? thank you. Two-thirds of beverages served in the US today are cold beverages. Now, we've taken our coffee leadership to a next level through cold, maintaining a premium coffee forward beverage that is innovative and differentiates us from all others.
Now, Cold Brew is our third fastest growing segment over the last two years with a 30% CAGR. It's contributed significant growth over the pandemic. Cold Brew alone is over $1.2 billion business and growing. Again, let me say that, two-year 30% CAGR on an over $1.2 billion business. And I think really importantly, we are meeting our customers in relevant ways. Cold, refreshing, customized beverages that are largely enjoyed by our largest customer segments, Gen Z and Millennials.
Now, I think it looks like everyone has a beverage in their hands. All right, Nitia, why don't you go ahead and lead us in the tasting?
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Unverified Participant
Absolutely. So I'm excited to introduce our Pistachio Cr?me Cold Foam Cold Brew. It will be launching in stores [indiscernible] (00:08:41) 2023. So very soon. It is cold brew and it has a pistachio cr?me cold foam on top with a cocoa dusting and a nice citrus spritz. This drink was inspired by our Pistachio Latte that is served in our Roastery stores. It launched to commemorate the opening of the Chicago Roastery back in 2019.
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
All right. Let's take a taste. What do you think?
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Unverified Participant
Wow. What do you think?
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Michelle Burns
Executive Vice President-Global Coffee, Tea & Cocoa, Starbucks Corp.
Yes.
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