Starbucks today reported its Q1 FY22 earnings results and shared insights into its quarterly performance as it delivered strong, record first quarter revenue growth while navigating significant disruptions brought on by the COVID-19 Omicron variant.

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“This holiday quarter delivered strong revenue growth highlighted by incredible customer demand for Starbucks. As we enter the third year of this pandemic, our stores continue to play an important role as a community gathering place that offers safe, familiar, and convenient experiences for our customers. Although demand was strong, this pandemic has not been linear and the macro environment remains dynamic as we experienced higher-than-expected inflationary pressures, increased costs due to Omicron, and a tight labor market. We remain focused on actions that drive both top and bottom-line growth, including industry-leading investments to attract, train and retain the best talent for our stores as customer occasions increase,” said Kevin Johnson, president and ceo.

“Starbucks will proactively address the industry challenges and operating environment, as we continue to focus on our partners and customers. Our brand is stronger and more resilient than ever, and we remain confident in the long-term outlook as we navigate the future of Starbucks together,” concluded Johnson.

Key Takeaways

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Global consumer demand for Starbucks is strong.

Starbucks delivered record first quarter revenue of $8.1B, representing 19% growth, while global same-store sales grew 13%, demonstrating strong customer affinity for Starbucks.

In the U.S., same store sales grew 18% year over year with the company reporting a double-digit increase in customer traffic and an increase in customer demand throughout all dayparts. This was driven by the company’s holiday lineup and strong in-store and digital customer connection throughout the season, which also resulted in record Starbucks Card activations and reloads. Starbucks Rewards loyalty program membership grew 21% to a record 26.4 million 90-day active members.

Starbucks continued to grow its footprint in China in Q1, surpassing 5,500 stores with new stores continuing to perform well. The company is encouraged by the performance and growth in its digital platforms in the market, where digital ordering grew to a record 38% of sales, and 90-day active Starbucks Rewards members reached nearly 18 million with members contributing 75% of sales. Starbucks Continues to Prioritize Health and Safety of Partners and Customers

Since the beginning of the pandemic, Starbucks has prioritized the health and wellness of our partners and customers and playing a constructive role in supporting local health officials and government leaders.

In the U.S., throughout Q1, Starbucks continued to offer COVID-19 vaccination pay, which has supported thousands of partners and broader efforts in helping get more people vaccinated. With the rise of the highly transmissible Omicron variant, the company saw more partners leverage isolation pay benefits as they were either home sick or home isolating after being exposed to the virus, which led to significantly higher COVID-19-related benefits pay than expected. Starbucks offers full support with comprehensive care to our partners impacted by COVID-19, including vaccine pay, catastrophe pay, mental health and sick pay benefits, childcare support and more.

In China, the company navigated mobility restrictions in adherence with the country’s “zero-COVID” policy, and the market experienced closures, dynamic store protocols, or reduced operations in three- quarters of stores in China exiting Q1.

Company Continues to Strategically Navigate Disruptions from the Omicron Variant

While the company reported growth in the quarter, Starbucks leaders shared additional details on the extraordinary cost pressure experienced due to additional disruptions caused by the Omicron variant, resulting in higher than anticipated costs across its U.S. and China business as stores quickly adapted protocols.

Like many others in the industry, Starbucks experienced a rapid increase in supply chain costs in the U.S. related to distribution and transportation driven by supply chain staffing shortages. This required the company to identify more expensive alternatives to meet strong customer demand. While supply chain driven inflationary costs were unexpectedly amplified and rapidly accelerated in December, these disruptions are expected to continue for the foreseeable future.

Starbucks also reported higher than anticipated costs from training and onboarding new green apron partners, a critical investment as the company works to create a great Starbucks Experience. The company remains confident that the previously announced $1B investment in partner wages and hours is the right long-term investment to ensure it has the very best talent in place to support its business.

The company believes these are near-term challenges and is taking necessary measures to offset these expenditures, including reducing discretionary spend, implementing operational efficiencies throughout the organization, and taking additional pricing actions planned through the balance of the year to mitigate cost pressures, including inflation as it looks to position its business for the future.

Starbucks remains confident in the company’s ability to rapidly adapt while continuing to drive longer-term agenda of share gains, growth and value creation. Leadership emphasized the tremendous opportunity for continued growth, as highlighted by robust revenue results and reiterated confidence that the Starbucks brand is stronger and more resilient than ever.

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Key Takeaways from Starbucks Q1 FY22 Earnings Call - Starbucks Stories

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Starbucks Stories

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Starbucks Corporation

Key Takeaways from Starbucks Q1 FY22 Earnings Call

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Starbucks today announced record-breaking Q4 FY21 earnings results, sharing insights into the company’s performance and as well as outlining steps being taken to position the company for continued growth into the future.

“Our strong finish to fiscal 2021, including record performance in the fourth quarter, demonstrates the resilience of Starbucks and reinforces the value of the bold strategic moves we have taken over the past two years. Through it all, we have thoughtfully navigated a strong recovery with an eye towards our future, all guided by our Mission and Values,” said Kevin Johnson, president and ceo.&nbsp;

“Today we announce we will be doubling-down on our investments in our partners, the heartbeat of our company. We know that when we exceed the expectations of our people, they in turn exceed the expectations of our customers - which creates value for all of our stakeholders - our partners, our customers, our communities and our shareholders. We anticipate that our strong business momentum, increased operating efficiency and continued global store expansion will fund these unprecedented investments while delivering yet another year of significant growth,” concluded Johnson.

Full details on Starbucks financial results can be found <a href="https://stories.starbucks.com/press/2021/starbucks-reports-q4-and-full-year-fiscal-2021-results/">here</a>.

Starbuck is Investing in Partners: Yesterday, Starbucks <a href="https://stories.starbucks.com/press/2021/starbucks-makes-historic-investments-in-its-partners/">announced a historic investment</a> in its store partners, building on the company’s belief that success is best when shared and is good for business over the long term. As part of the announcement, the company shared that effective in January 2022, retail partners with two or more years of service could receive up to a 5% raise while retail partners with five or more years could receive up to a 10% raise. Additionally, in Summer 2022, average pay for all U.S. hourly retail partners will be nearly $17/hr., with baristas hourly rates to range based on market and tenure from $15 to $23/ hr. across the country. To continue to build a great and enduring company and strengthen the global brand, Starbucks continues to invest ahead of the growth curve. Not just in wages, but in training and technology, and the overall Starbucks Experience for both partners and customers.

Company’s “Growth at Scale” Agenda Drives Continued Recovery: Starbucks recovery in the U.S. continued with the company reporting sequential improvement of two-year comp growth to 11%, with comps accelerating throughout the quarter and marking the second quarter of double digit two-year comps in the U.S. Starbucks momentum in the U.S. continues to be fueled by its “Growth at Scale” agenda, which focuses on elevating the customer experience, beverage innovation and digital customer engagement – a strategy that continues to pay off for the company.

Globally, the company reported that Q4 comparable store sales were up 17%, driven by a 15% increase in comparable transactions and a 2% increase in average ticket. The company extended its market leadership position in China, and while pandemic related disruptions in Q4 affected the majority of stores at its peak and impacted recovery momentum, Starbucks China grew revenue 11% year-over-year. Company Deepens Digital Engagement Globally: Starbucks continues to build and leverage its technology-first, mobile and digital capabilities and accelerate growth in active membership in the Starbucks Rewards loyalty program, fueling the company for the long-term. In China, 90-day active Starbucks Rewards members grew to a record 17.9M, while in the U.S. reported a 90-day active member base of nearly 25M, up 28% versus the prior year. In the U.S., Starbucks Rewards members drove 51% of company-operated sales.

Cultivating direct digital relationships with customers continues to be a focus for the company and Starbucks Rewards program enhancements such as ‘Stars for Everyone’ are helping expand reach. The company also alluded to future enhancements designed to provide personalized experiences while the company looks to remain at the forefront of disruptive innovation in loyalty that will unfold over the next few years.

Focus on Elevated Customer Experiences Continues: As consumer mobility increases, Starbucks continues to adapt to stay ahead of evolving customer trends. The company outlined a rich pipeline of innovation to elevate the Starbucks Experience in retail stores and drive convenience for partners and customers, including the roll-out of the new Mastrena II espresso machines that more efficiently pulls triple-shots of high-quality espresso; Deep Brew artificial intelligence platform that has automated daily inventory management; and store staffing and training improvements designed to reduce complexity in stores.

Additionally, the company shared that it has repositioned 500 stores in the U.S., as planned, to better locations with more favorable economics, while expanding its portfolio of convenience formats to meet customer needs. In China, Starbucks expanded its store footprint, opening 225 net new stores in the quarter, and now boasts 5,360 stores in 208 cities in the country. In FY21, Starbucks opened approximately 1,200 net new stores, ending the fiscal year with a record 33,833 stores globally.

Company Sees Positive Signs Globally: With more than 33,000 stores in 84 markets, Starbucks is able to provide a unique perspective on the global recovery from the pandemic. The company reported continued recovery globally where Latin America grew system sales by 113% in Q4 driven by a strong recovery in Mexico, EMEA posted system sales growth of 52% in the quarter and Japan navigated through a challenging quarter turning the corner towards renewed growth. Starbucks sees positive signs in many other markets as well, reinforcing the company’s belief that pandemic-related headwinds are temporary.

In addition, Starbucks strategic channel partnerships with the North American Coffee Partnership with PepsiCo and the Global Coffee Alliance with Nestle remain on-plan, and have propelled Starbucks to number one share positions in the U.S. and throughout many other markets around the world, further underscoring the strength and resilience of the Starbucks brand and illuminating the decades long runway of growth ahead.

A Preview of What’s Ahead: Starbucks is entering fiscal 2022 with strong customer demand and solid momentum in our U.S. business, an expanding and accelerating in-store, channels and digital flywheel, and green apron partners eager to deliver an elevated Starbucks Experience to their customers.

Today, Starbucks also introduced guidance for fiscal 2022 including:

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As Starbucks enters the new fiscal year, the company is gearing up for a record-breaking holiday, with strong growth planned around the world and a holiday campaign designed to build genuine human connection as only Starbucks can at a time when human connection is more important than ever.

Partner in facial covering wearing a ball cap serves a customer in front of a colorful mural

Key takeaways from Starbucks Q4 FY21 earnings results

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Starbucks today announced record-breaking Q3 FY21 earnings results, fueled by the continued strength of the Starbucks brand around the world. As customer mobility increases, the company is at the beginning of what it has deemed “The Great Human Reconnection,” which is translating to increases in demand for Starbucks as people are again on-the-go, reconnecting and socializing with one another.

“Starbucks delivered record performance in the third quarter, demonstrating powerful momentum beyond recovery. Our ability to move with speed and agility and to be out in front of shifting customer behaviors has helped further differentiate Starbucks, positioning us well for this moment,” said Kevin Johnson, president and ceo.&nbsp;

“As the Great Human Reconnection continues to unfold, our partners are rising to the occasion, ready to meet our customers wherever they need us to be – with the right store, in the right place, at the right time. Given the strength of our diverse portfolio and the elevated Starbucks Experience, as evidenced in our Q3 record results, we are raising our full-year financial outlook and are confident in our ability to continue to execute our ‘Growth at Scale’ agenda to unlock the full potential of the Starbucks brand,” concluded Johnson.

Full details on Starbucks financial results can be found&nbsp;<a href="https://stories.starbucks.com/press/2021/starbucks-reports-q3-fiscal-2021-results/">here</a>.

Starbucks ‘Growth at Scale’ Agenda&nbsp;Drives Record-Breaking Results

The impressive momentum Starbucks <a href="https://stories.starbucks.com/stories/2021/key-takeaways-from-starbucks-q2-fy21-earnings-results/">saw in Q2</a>&nbsp;, accelerated through Q3, which delivered record revenue of $7.5 billion, up 78% year-on-year driven by strong performance in the U.S., significant net new store growth in China, and continued share gains in the at-home coffee market.&nbsp;&nbsp;

In the U.S., the company’s disciplined focus on delivering beverage innovation, elevating the customer experience and creating digital relationships with customers drove year-on-year revenue growth of 90% and two-year revenue growth of 16%. Comparable same store sales grew 83%, and importantly, two-year comp grew 10%, despite mobility restrictions still impacting some U.S. geographies and industry-wide pressure in pockets of the supply chain.

Starbucks China reported positive results with year-on-year revenue growth of 45% while total revenue in China has grown by 23% in just two years. The company posted 19% same store comp growth in Q3 and reported sequential improvement on every key metric on a two-year basis, including total revenue growth, store traffic recovery and margin expansion. Starbucks China ended the quarter with 5,135 stores and is well on track to operate over 6,000 stores by the end of fiscal year 2022.

Strong Demand for Cold Coffee Fuels Starbucks Results

Starbucks continues to see strong demand for Starbucks Cold Brew, Nitro Cold Brew, and Starbucks Refreshers beverages. <a href="https://stories.starbucks.com/stories/2021/shake-things-up-a-little-with-starbucks-new-non-dairy-iced-shaken-espresso-beverages/">Iced Shaken Espresso</a>&nbsp;alone contributed more than a third of the U.S. iced espresso growth in the quarter. The cold category represented 74% of U.S. beverage sales in Q3, growing 10 percentage points over the last two years.

Additionally, alternative dairy offerings now represent nearly 25% of milk related beverage sales in the U.S. These products in cold and alternative dairy are particularly attractive to Millennial and Gen Z customers and are aligned with the company’s focus on the well-being of people and the planet.

Shifting Customer Behaviors Extend the Starbucks Experience

As consumer behaviors continue to evolve, the company continues to extend the Starbucks Experience through digital customer relationships and relevant store formats.

In the U.S., the Starbucks Rewards loyalty program grew to more than 24 million active members*, representing 51% of all spend in U.S. company-operated stores and up 8 percentage points over pre-pandemic levels. More and more, customers are embracing experiences that effortlessly fit their lifestyle, as evidenced at U.S. company-operated stores where drive-thru represented 47% of transactions and mobile ordering for in-store pickup, delivery or curbside at 26% of transactions.

In China, Starbucks is expanding digital customer relationships and engagement by creating new occasions and experiences to make mobile ordering even more convenient and personalized. This has resonated strongly with customers in China, propelling mobile ordering to 34% of sales, more than double pre-COVID levels. Starbucks Rewards continues to expand, driving 90-day active members to an all-time high of 17 million, a 4% increase over the previous quarter and a 71% increase versus prior year.

Company Expands Reach and Leadership Position in At Home Coffee

In Q3, Starbucks retained its #1 brand position in total U.S. at-home coffee, further expanding its leadership position.

The Global Coffee Alliance with Nestlé continues to see strong performance across all aspects of the key strategic relationship. The Starbucks by Nespresso on the Vertuo line, introduced earlier this year, is already exceeding 6-month distribution and velocity targets, building on the success of the Starbucks by Nespresso platform.

In the Ready-to-Drink category, Starbucks is the #1 premium brand globally, with the North American Coffee Partnership with PepsiCo growing 19% in consumption, and the international Ready-to-Drink business growing double-digits in EMEA and China Asia Pacific.&nbsp;

These channels amplify the Starbucks brand in more than 80 markets around the globe, offering millions of consumers at-home and at-work options that complement their Starbucks in-store experience. Just yesterday, the company <a href="https://stories.starbucks.com/press/2021/starbucks-and-nestle-to-bring-ready-to-drink-coffee-beverages-to-southeast-asia-oceania-and-latin-america/">announced plans</a> to reach new markets and grow its Starbucks Ready-to-Drink portfolio with Nestlé, who will now serve markets across Southeast Asia and Latin America.

50 Years Later, Starbucks Future is Bright

As the company celebrates its 50th Anniversary, Starbucks remains as confident as ever in its strategy and believes this quarter represents the beginning of a multi-year tailwind, powered by:

The combination of what’s ahead, reinforced by the company’s strong Q3 results provides Starbucks with confidence that this is just the beginning of what is about to unfold.&nbsp;

Starbucks barista in black headscarf smiles and pours steamed milk

Starbucks today announced record-breaking Q3 FY21 earnings results, fueled by the continued strength of the Starbucks brand around the world.

Key takeaways from Starbucks Q3 FY21 earnings results

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Starbucks today announced its Q2 FY21 earnings results, demonstrating full sales recovery in the U.S and forward momentum globally. While the COVID-19 pandemic is not over, this momentum gives the company confidence to raise full year guidance for the remainder of FY21.

“I am very pleased with our progress to date in fiscal 2021, as our second quarter results demonstrated impressive momentum in the business with full sales recovery in the U.S.&nbsp; Our strong results validate our ability to adapt to changes in our environment and the needs of our customers,” said Kevin Johnson, president and ceo.&nbsp;

“We have positioned Starbucks for the inevitable great human reconnection that we see unfolding in the U.S. and will propagate in every market around the world, where people once again connect with others face-to-face to heal, to belong, to reflect, to share and to celebrate.&nbsp; Starbucks was built for this moment, and as we celebrate our 50th anniversary, we remain confident in our ability to execute our ‘Growth at Scale’ agenda and unlock the full potential of the Starbucks brand,” concluded Johnson.

Full details on Starbucks financial results can be found <a href="https://stories.starbucks.com/press/2021/starbucks-reports-q2-fiscal-2021-results/" target="_blank" rel="noreferrer noopener">here</a>.

1. Starbucks ‘Growth At Scale’ Agenda Drives Continued Momentum

With its Growth at Sale agenda in place well before the global pandemic emerged, Starbuck quickly set guiding principles and established store protocols to navigate the pandemic globally. The company continues to monitor events in real-time, quickly adapting to changing conditions and working to provide safe, familiar and convenient experiences for our partners (employees) and customers.

With vaccination programs underway, and in turn, increased customer mobility, the company has begun to see what it describes as “The Great Human Reconnection,” which is coming to life in stores globally as the COVID-19 vaccine distribution progresses at varying rates. This was evidenced by sales in the U.S., where second-quarter comparable store sales rose to 9% in the U.S., with average ticket meaningfully higher than pre-pandemic levels. Importantly, the company furthered its three business-driving initiatives fundamental to the company’s “Growth at Scale” agenda: elevating the customer experience, driving relevant beverage innovation, and expanding digital customer engagement.&nbsp;

In China, Starbucks reported a 91% comparable store sales growth, including VAT favorability of approximately 9 percentage points. As COVID-related travel restrictions subsided late in the quarter, the market saw momentum in customer mobility, particularly in the residential, office and commercial trade zones. In Q2, Starbucks opened 110 net new stores, equating to 14% growth in net new stores over the past 12 months. This week, Starbucks announced the company’s 5,000th store opening in China, demonstrating continued confidence in Starbucks long-term growth opportunity in China.

2. As Customers Seek Reconnection, Starbucks Provides Convenient, Elevated And Personalized Experiences With continued focus on building connections between partners and customers, Starbucks strives to meet customers where they are, even as transactions have migrated from dense metro centers to suburbs, and from cafés to drive-thrus. The company reported that affinity for Starbucks has strengthened, as measured by improvements in customer connection scores and growth in customer loyalty, which further reinforces the strength and resilience of the Starbucks brand and healthy optimism for the future.

The drive-thru channel has improved quarter-over-quarter since the onset of the pandemic, and Starbucks continues to invest in several initiatives to increase throughput. including updated operational standards, “hand-held order devices,” more efficient warming ovens, and accelerated deployment of our more efficient Mastrena Espresso machines. As a result, Drive-Thru saw a slight improvement in “out-the-window” times versus the prior year. Out-the-window drove over 50% of net sales in Q2, increasing more than 10% from pre-pandemic levels.

As the Great Human Reconnection gains momentum, and in anticipation of behaviors and daily routines continuing to evolve, Starbucks is meeting customers wherever they may be, with the right store, in the right place, and at the right time.

3. Increased Strength Of Digital Customer Relationships Drives Results Through Starbucks Rewards™ And Beyond

Digital continues to be a significant growth driver for the company, with the Starbucks Rewards™ loyalty program continuing to exceed pre-COVID levels.

The Starbucks Rewards program saw continued growth in member spend, accounting for 52% of U.S. company-operated sales in Q2, reflecting strong member engagement, and the program grew to a record 22.9 million* members in the quarter. The loyalty program’s member base has expanded by 19% following the launch of <a href="https://stories.starbucks.com/stories/2020/seeing-stars-more-ways-to-pay-and-5-fun-facts-about-starbucks-rewards/">Stars for Everyone</a>&nbsp;just six months ago.

The company’s digital capabilities are credited with successfully transforming digital relationships to drive mobile ordering, while also amplifying convenience and safety which remain top of mind for customers. Mobile orders represented 26% of U.S. company-operated transactions in Q2, up from 18% a year ago.

In China, the number of 90-day active Starbucks Rewards members more than doubled versus the prior year to 16.3 million, driving 72% of sales in China, up 5 percentage points from prior year. In addition, the company expanded the Starbucks Now™ mobile order and pay service to WeChat, making mobile ordering services available to customers on both Alibaba and WeChat ecosystems, as well as on the Starbucks App. Mobile Order sales mix hit a record 24% of sales in China, up from 30% in Q1, with 15% driven by Starbucks Delivers and 19% from Starbucks now. Starbuck Rewards customers engagement continues to grow as mobile order sales have more than doubled in China over this past year.

4. Starbucks Cold Beverage Menu Continues to be Hot

With a focus on relevant new hand-crafted beverages, Starbucks Winter and Spring menus resonated with customers and drove momentum. Cold beverages delivered resounding year-over-year growth in Q2 led by Cold Espresso, Starbucks Refreshers and Cold Brew. The company also reported overwhelmingly positive response to <a href="https://stories.starbucks.com/press/2021/oatly-oatmilk-coming-to-starbucks-nationwide-in-the-us/" target="_blank" rel="noreferrer noopener">Oatmilk</a>, with the Iced Brown Sugar Oatmilk Shaken Espresso far exceeding expectations to-date. This has helped push year-over-year growth of 53% in alt-dairy beverage sales as customers continue to gravitate toward the company’s leading portfolio of non-dairy beverage options.

In the U.S., average ticket remains meaningfully higher than pre-pandemic levels, driven by a combination of increased beverage attach, increased customization and all-time high food attach, with plant-based options and breakfast sandwiches leading the way.

5. At Home Coffee Amplifies Brand with Increased Category Share

Throughout the quarter, availability of Starbucks products through multiple channels gained further relevance as Starbucks share of total packaged coffee outpaced the category, growing over 8% in dollar sales in the U.S. in Q2. Starbucks remained the number one brand in total coffee in the U.S. and was the top share gainer of the coffee category in Q2, gaining nearly one and a half points over the prior year.

Internationally, Starbucks products on single-serve platforms, including Nespresso and Dolce Gusto, continue to exceed expectations. The Global Coffee Alliance is now in 71 markets around the world, up from 48 markets in Q2 FY20.

In addition, consumption of U.S. ready-to-drink coffee products (in partnership with PepsiCo) grew more than 23% in the quarter, over a 5% increase from Q1. The company recently launched new beverages, including the <a href="https://stories.starbucks.com/stories/2021/revamp-your-daily-coffee-ritual-with-new-starbucks-cold-and-crafted-and-more/" target="_blank" rel="noreferrer noopener">Cold &amp; Crafted platform and new Nitro Cold beverages</a>, leveraging last year’s Starbucks Nitro RTD platform launch, the number one innovation in the RTD category.

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*90-day active Starbucks Rewards members as of Q2

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Starbucks today announced its Q2 FY21 earnings results, demonstrating full sales recovery in the U.S and forward momentum globally.

Key takeaways from Starbucks Q2 FY21 Earnings Results

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Starbucks today announced its Q1 FY21 earnings results, reaffirming an optimistic outlook for the long-term and reinforcing that Starbucks is stronger and more resilient than ever.

“I am very pleased with our start to fiscal 2021, with meaningful, sequential improvements in quarterly financial results despite ongoing business disruption from the pandemic. Investments in our partners, beverage innovation and digital customer relationships continued to fuel our recovery and position Starbucks for long-term, sustainable growth,” said Kevin Johnson, president and ceo.&nbsp;

“Our results demonstrate the continued strength and relevance of our brand, the effectiveness of the actions we’ve taken to adapt to changes in consumer behavior and the steadfast commitment of our green apron partners to serve our customers and communities. We remain optimistic about our robust operating outlook for fiscal 2021 as well as our ability to unlock the full potential of Starbucks to create value for our stakeholders,” concluded Johnson.

Full details on Starbucks financial results can be found <a href="https://stories.starbucks.com/press/2021/starbucks-reports-q1-fiscal-2021-results/" data-type="URL" data-id="https://stories.starbucks.com/press/2021/starbucks-reports-q1-fiscal-2021-results/">here</a>.

1. Starbucks ‘Growth at Scale’ agenda is fueling a global business recovery

This week marks a full year since the company temporarily closed stores across China to protect partners and customers from the Coronavirus, and quickly established <a href="https://stories.starbucks.com/press/2020/navigating-through-covid-19/">guiding principles</a>&nbsp;used to navigate the pandemic globally. One year later, the company reports that its business in China recovered in Q1 in line with expectations, and it remains on track to achieve full sales recovery of its U.S. business by the end of Q2.

In China, Starbucks reported an impressive 5% comparable store sales growth and emphasized the rapid re-acceleration of new store development in the market. In Q1, the company opened almost 160 stores and crossed the 4,800-store milestone, equating to 13% growth in net new stores over the last 12 months.

In the U.S., first-quarter comparable store sales of -5% in the U.S. improved from the prior quarter and the company continues to see average ticket meaningfully higher than pre-pandemic levels. Throughout the quarter, the company laid a solid foundation for achieving FY21 goals by further advancing the three business-driving initiatives fundamental to the company’s “Growth at Scale” agenda: elevating the customer experience, driving relevant beverage innovation, and expanding digital customer engagement.&nbsp;

While this recovery has not been linear, Starbucks is well-positioned to continue to monitor events in real-time and will adapt to the changing conditions in markets around the world.

2. Adapting to changing customer behaviors leads to elevated customer experience As many of our customers have adapted to their work-or-study from-home realities, the company believes Starbucks visits have evolved from “the stop” on the way to a destination to becoming the destination worth leaving home for – and because it is familiar and convenient. &nbsp;

Starbucks has continued to evolve to meet this behavior, prioritizing partner and customer safety, including increasing throughput in drive-thrus, expanded digital reach which maximizes the ability to order ahead, enable curbside pickup and expand delivery capabilities. This work was evident in Q1 with U.S. stores with drive-thrus recording slight improvements in "out-the-window" times, delivering positive comps throughout the quarter and driving over half of net sales in Q1, increasing more than 10% from pre-pandemic levels.

The company is confident its targeted initiatives to unlock capacity and enhance the customer experience at our drive-thru locations are boosting business recovery while strengthening our foundation for future growth.

3. Growth of digital customer relationships drives results – with Starbucks Rewards™ leading the way

Following a successful launch of Stars for Everyone&nbsp; in the U.S. in Q4, the Starbucks Rewards™ loyalty program achieved phenomenon results in Q1, providing a strong foundation for growth in fiscal 2021 and beyond.

In the U.S., the program grew to a record 21.8 million members* - a 2.5 million increase within the quarter - surpassing pre-COVID totals and representing a 15% increase relative to the same quarter in the prior year. Engagement from Starbucks Rewards members also increased, with these customers contributing 50% of U.S. company-operated sales, up from 43% last year and up from 47% in the prior quarter.

In China, the Starbucks Rewards program grew to 15.4 million in Q1, a record increase of 51% versus the prior year and 14% over the previous quarter. China also reported strong engagement in digital initiatives, including setting a single-day retail sales record on the region’s “Starbucks Rewards Members Night.” Member engagement campaigns and additional functionalities boosted member engagement and frequency throughout the quarter.

4. Cold continues to be hot

Pumpkin Cream Cold Brew’s success in last quarter’s lineup provided a preview to the December return of the new Holiday favorite, Irish Cream Cold Brew, delighting customers. Starbucks Cold beverages continued to resonate with customers, led by Iced White Chocolate Mocha, Iced Chai Latte and Vanilla Sweet Cream Cold Brew, with all three delivering positive year-over-year growth.

In the U.S., the company reported an increase in average ticket, driven by a combination of group ordering and increased beverage attach, premium beverage mix, increased customization and all-time high food attachment drove U.S. ticket growth of approximately 19% in Q1.

5. Powerful partnerships secure channel leadership

The availability of Starbucks products through multiple channels has secured Starbucks leadership position in the category, acting as a brand amplifier for our specialty coffee retail business.

Demand in Starbucks at-home coffee remains high and, in the U.S., Starbucks share of total packaged coffee grew significantly in the quarter with dollar sales up nearly 14%, nearly twice the category average. Through the Global Coffee Alliance with Nestle, the company finished calendar year 2020 as the number one coffee brand across the entire coffee category. With Nestle, Starbucks entered four new markets in the quarter, bringing Starbucks at-home coffee presence through the Global Coffee Alliance to 66 markets in just over two years.&nbsp; &nbsp;&nbsp;

In addition, consumption of U.S. ready-to-drink coffee products (in partnership with PepsiCo) grew 18% in the quarter and the introduction of Ready-to-Drink Nitro Cold Brew, which was the number one innovation in the category last year, exceeded sales expectations.&nbsp;

Fond Farewells and Warm Welcomes&nbsp;

During the call, Starbucks leaders welcomed incoming chief financial officer, Rachel Ruggeri who will assume the role on February 1, as the company announced last month with the planned retirement of current cfo Patrick Grismer.

Additionally, the company shared today that chief operating officer Roz Brewer has accepted a new opportunity as chief executive officer at another publicly traded company and her responsibilities will be assumed by Rossann Williams, president&nbsp; of our North America retail business, and Brady Brewer, executive vice president and chief marketing officer. Combined, Rachel, Rossann and Brady have more than 45 years of Starbucks experience, and the company remains well-positioned for the future.

*90-day active Starbucks Rewards members as of Q1 FY21

Key takeaways from Starbucks Q1 FY21 Earnings Results - Starbucks Stories

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