Coffee shops up and down the U.S. coasts are advertising lattes with CBD oil, but Starbucks CEO Kevin Johnson said that the coffee giant isn’t planning on introducing its own version of the cannabis-infused drink.
Johnson said that the company is going to keep focusing on its other innovations, like its Nitro Cold Brew. The company credited its iced beverages, including its nitro drinks, with boosting sales for the quarter that ended Dec. 30.
The company released its first-quarter results Thursday, reporting better-than-expected sales and earnings growth. The coffee giant posted same-store sales growth of 4 percent, topping Refinitiv estimates of 2.8 percent. Same-store sales growth in its two largest markets, the U.S. and China/Asia Pacific, also outpaced expectations.
Starbucks avoided a repeat of 2017’s disappointing holiday sales by using analytics, artificial intelligence and consumer focus groups to better understand what customers want, Johnson said. This time around, it offered fewer limited-time drinks at lower prices. The line-up included six returning seasonal favorites, including the Peppermint Mocha and Gingerbread Latte.
The company earned 68 cents per share after removing a 7-cent gain from income tax items. Wall Street had been expecting earnings of 65 cents per share. Revenue 9 percent to $6.63 billion, also topping estimates.
Shares of Starbucks, which has an $80.3 billion market value, rose nearly 4 percent Friday morning.
Johnson assumed the role of chief executive in April 2017, taking the reins from longtime CEO Howard Schultz. Under Johnson, a former Microsoft executive and CEO of Juniper Networks, the company has focused heavily on its digital presence. Most recently, the company announced its expansion of a delivery pilot with UberEats to six more U.S. cities beyond its original test in Miami.
The company has been driving sales by adding more rewards members, with the number reaching 16 million active members. For customers not interested in the loyalty program, Starbucks has been building an email list — now 13 million strong — to promote its products and deals.