Starbucks profit surges on loyal US sales and overseas expansion

Starbucks recently posted better-than-expected sales and profits in its fiscal fourth quarter that ended October 2 --- the figures largely resulting from the coffee chain's loyal US sales as well as overseas expansion; thereby countering the effects of the weak sales that the company witnessed in crisis-hit Europe.

According to the quarterly results posted by Starbucks, the net profits of the company increased 29 percent to $359million; while its sales touched a record-high of $3billion, though marking only a moderate 7 percent rise.

Despite the fact that the quarterly results posted by Starbucks - which has as many as 17,000 stores in 55 countries - were boosted by one-off items, they still underscored that the company enjoys an enviable status as one of the few US consumer firms that have been spared the disquieting blows from the economic gloom that has hit many US residents.

While Starbucks had been trying to cope with rising coffee costs and the economic downturn, the company has apparently been more resilient as compared to its competitors, with its customers showing their loyalty towards the brand even in the face of regular menu-price increases.

Noting that Starbucks had taken "far less" of an increase than others in the industry, Troy Alstead - Chief Financial Officer of Starbucks - said that the company could "offset most of the commodities costs problem, not with pricing, but with a more efficient cost structure and strong traffic growth, which has given us a lot of leverage on our bottom line."