Embracing our heritage and values while aiming higher than ever.

110 Pages·2013·1.82 MB·English

Fiscal 2012 Financial Highlights
Net Revenues (in Billions) Comparable Store Sales Growth
$13.3 (Company-Operated Stores Open 13 Months or Longer)
$11.7
$10.7 8%
$10.4 7%* 7%
$9.8
1971 –3%
Seattle
–6%
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
Operating Income (in Millions) Operating Margin
GAAP Non-GAAP GAAP Non-GAAP
14.8%14.5%** 15.0%
$1,997
13.3%13.5%**
$1,728 $1,698**
Embracing our heritage and values
The artwork on the cover is inspired by the Siren from $1,419$1,414**
9.2%**
our original store's logo in Seattle's Pike Place Market. 8.1%**
The second illustration comes from the interior of our while aiming higher than ever. $843** $894** 5.7%
4.9%
$562
first store in Mumbai, India. These drawings evoke the $504
Starbucks Experience, treasured in Seattle since 1971
and now around the world. Starbucks Corporation Fiscal 2012 Annual Report
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
Earnings per Diluted Share Operating Cash Flow & Capital Expenditures
(in Millions)
GAAP EPS Non-GAAP EPS
Cash from Operations Capital Expenditures
$1.79 $1,705 $1,750
$1,612
$1.62
$1.52***
$1,389
$1.24$1.23** $1,259
$985
2012 $856
Mumbai $0.71** $0.80**
$0.43 $0.52 $446 $441 $532
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
* 2010 comparable store sales growth was calculated excluding the additional week in September 2010.
* * Non-GAAP measure. Excludes $339, $332 and $53 million in pretax restructuring and transformation charges in 2008, 2009 and 2010, respectively.
Also excludes a benefit from the 53rd week in 2010 of approximately $59 million and a gain on the sale of properties in 2011 of $30 million.
© 2013 STARBUCKS CORPORATION. ALL RIGHTS RESERVED. SJBQ413OTH-00975 *** 2011 excludes $0.10 of gain resulting from the acquisition of the company’s joint venture operations in Switzerland and Austria and the gain on the sale of properties.
Fiscal 2012 Financial Highlights
Net Revenues (in Billions) Comparable Store Sales Growth
$13.3 (Company-Operated Stores Open 13 Months or Longer)
$11.7
$10.7 8%
$10.4 7%* 7%
$9.8
1971 –3%
Seattle
–6%
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
Operating Income (in Millions) Operating Margin
GAAP Non-GAAP GAAP Non-GAAP
14.8%14.5%** 15.0%
$1,997
13.3%13.5%**
$1,728 $1,698**
Embracing our heritage and values
The artwork on the cover is inspired by the Siren from $1,419$1,414**
9.2%**
our original store's logo in Seattle's Pike Place Market. 8.1%**
The second illustration comes from the interior of our while aiming higher than ever. $843** $894** 5.7%
4.9%
$562
first store in Mumbai, India. These drawings evoke the $504
Starbucks Experience, treasured in Seattle since 1971
and now around the world. Starbucks Corporation Fiscal 2012 Annual Report
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
Earnings per Diluted Share Operating Cash Flow & Capital Expenditures
(in Millions)
GAAP EPS Non-GAAP EPS
Cash from Operations Capital Expenditures
$1.79 $1,705 $1,750
$1,612
$1.62
$1.52***
$1,389
$1.24$1.23** $1,259
$985
2012 $856
Mumbai $0.71** $0.80**
$0.43 $0.52 $446 $441 $532
2008 2009 2010 2011 2012 2008 2009 2010 2011 2012
* 2010 comparable store sales growth was calculated excluding the additional week in September 2010.
* * Non-GAAP measure. Excludes $339, $332 and $53 million in pretax restructuring and transformation charges in 2008, 2009 and 2010, respectively.
Also excludes a benefit from the 53rd week in 2010 of approximately $59 million and a gain on the sale of properties in 2011 of $30 million.
© 2013 STARBUCKS CORPORATION. ALL RIGHTS RESERVED. SJBQ413OTH-00975 *** 2011 excludes $0.10 of gain resulting from the acquisition of the company’s joint venture operations in Switzerland and Austria and the gain on the sale of properties.
we will ceaselessly honor our values. I firmly believe that our loyalty and Card program, and mobile technologies. non-coffee beverage categories. With La Boulange® Market Information Board of Directors
the ability to adhere to these attributes is what defines It is hard to overstate the collective power of Starbucks bakery products, we have begun the transformation of the
and Senior Leadership Team
the most enduring organizations of our time, and as I 54 million Facebook fans, 3 million Twitter followers, selection, taste, and quality of the fresh food in our stores.
share them with you in the context of highlights from 14.6 million loyalty program members, and 7 million users Second, adding Evolution Fresh to our brand portfolio
Starbucks past year, I think you will agree that they of our mobile applications, who pay this way 2 million fulfills our commitment to health and wellness, and not just
are key to our ongoing success. times each week. We also gave our customers another by bringing high-quality premium juices to our customers
Starbucks common stock is traded on the NASDAQ Global Board of Directors
quick, mobile way to pay by forging a partnership with but by extending the Evolution Fresh brand to an exciting
Staying True to Our Core Purpose Square. We will not stop innovating on this front, where new store concept. With Evolution Fresh™ juice products Sfoellleocwti nMga trakbetle ( “sNhoAwSDs AthQe” q),u uanrtdeerrly t hheig shy amnbdo llo SwB sUaXle. The HSotawrbaurdck Ss cChourpltozration, chairman, president and chief executive officer
and Capabilities as We Grow our best-in-class digital reach, and more notably the currently in more than 2,200 Starbucks® stores as well as prices per share of Starbucks common stock for each
William W. Bradley
authentic engagement we ignite daily with millions of 1,500 grocery locations, we are on our way toward quarter during the last two fiscal years and the quarterly Allen & Company LLC, managing director
We will always be a coffee company cash dividend declared per share of its common stock
consumers online, will continue to drive our core business. nationwide distribution. Robert M. Gates
whose core business is to ethically during the periods indicated:
Former Secretary of Defense
source and roast the highest-quality Coffee and connection will always be the heart of Finally, with the acquisition of the high-end Teavana brand,
Cash Dividends Mellody Hobson
arabica coffee in the world, as we Starbucks, yet our ability to reinvigorate our business we’ll apply our competencies in retail operations and hot Fiscal 2012 High Low Declared Ariel Investments, LLC, president
simultaneously create authentic around that heritage remains an unmatched competitive and cold beverage creation to expand Teavana’s 300-store Fourth Quarter $54.28 $43.04 $0.21 Kevin R. Johnson
connections with our customers and the advantage. footprint as we reinvent the tea category, in part by Third Quarter 62.00 51.03 0.17 Juniper Networks, Inc., chief executive officer
1971, communities we serve. I assure you we bringing tea bars into Teavana stores and applying Second Quarter 56.55 45.28 0.17 Olden Lee
are not deviating from this purpose but Innovating with Timely Relevance, learnings from our own Tazo brand. Long term, our intent First Quarter 46.50 35.12 0.17 PepsiCo, Inc., retired executive
OPiuker fiPrlsatc est Moraer koeptens in Seattle's rather enhancing it with extreme diligence. Courage, and Conviction is to significantly grow Teavana’s global store presence, Fiscal 2011 High Low Cash DDiveicdleanredds JoKsishsuinag eCr oAosspoecria Rteasm, Inoc., vice chairman
Scaling the Starbucks Experience. Today, 42 years after Last year also saw significant product innovation around transforming tea just as we have transformed coffee. Fourth Quarter $42.00 $33.72 $0.17 James G. Shennan, Jr.
Dear Shareholders, opening our first store in Seattle, Starbucks operates in our coffee core, most notably in the $8 billion premium Our pace of innovation and creativity is rapid, and I assure Third Quarter 40.26 34.61 0.13 Trinity Ventures, general partner emeritus
61 countries, and we recently had our most successful single-cup category. you that every move is highly strategic and thoughtfully Second Quarter 38.21 30.75 0.13 Clara Shih
It is an honor to write you this First Quarter 33.15 25.37 0.13 Hearsay Social, Inc., chief executive officer
year, not only because we have launch ever, in India. I was in Mumbai when our doors We reached a true milestone with the launch of the executed as we push for relevant, timely, and disciplined Javier G. Teruel
apcehrfieovrmeda nrecceo brdu tfi bneacnacuiasle we obpuseinneedss, apnadrt nI pere irns oInndalilay, wTaittnae Gssloebda, lw Bitehv eoruarg feans,t athseti c tbheaatu hteifrual lVdes rtihsme ofir®s St ytismteem c,u as tbormeaekrsth craonu gmha tkeec Shtnaorlbougcyk s® raenidnv beenytoionnd i.n our stores, in consumer product channels, TfInilhivneeg scsto ommr aRpyea lbnayet’i soo nUbst. Sas.ie nSceetdico uwnr iiotthife otshu aet n ccdho aEmrxgpceah nbayny’ gsa ecw cCeebossmsiitnmeg ia sttsh ieo n MCyorlogant eE-.P aUlmllmolaivne, CIIoImpany, retired vice chairman
have once again done so by living unabashed affection and demand for Starbucks, a brewed or latte beverages in their homes. This is only the Honoring Our Culture’s Values http://investor.starbucks.com, at http://sec.gov, or by U.S. and International retail chief executive officer (retired)
ubpal aton ctihneg h perroitfiatgs ew oitfh o au rs occoimal pcaonnys,c ience. Our dtheefi nwiotirvled .signal that our brand is resonating around bVeergisinmnoin bgr aasn dw ein etom tbhaer kle oadn ian gm pullatityfeoarmr p ilna nth teo sginrogwle -tchuep and Guiding Principles madadkriensgs a, prehqounee snt utom Ibnevre ostro wr eRbeslaitteio lnisst ethdr boueglohw t.he CPreapigsi -EC.o Wla eCaomthpearnuyp, retired chief executive officer
commitment to creating shareholder value through In the China and Asia Pacific region in 2012, we once space, where sales of our other, complementary single- More than ever, today’s consumers have an interest in and Starbucks Coffee Company Senior Leadership Team
the lens of humanity is truly a cornerstone of Starbucks again posted strong annual returns, including 11 serve offerings are also accelerating. In 2012 Starbucks access to what companies stand for—their values. This is Investor Relations, Mailstop: EX4 Howard Schultzchairman, president and chief executive officer *
global strength, especially as we pursue the most consecutive quarters of double-digit comparable store VIA® Ready Brew sales grew significantly and we shipped nothing new to Starbucks. We’ve been building a company PO Box 34067 Troy Alsteadchief financial officer and chief administrative officer *
Seattle, WA 98124-1067
ambitious agenda in our company’s history. sales growth. This success showcases how—with nearly nearly 500 million K-Cup® packs, garnering approximately with a conscience for four decades, and the reservoir of [phone] Adam Brotmansenior vice president, chief digital officer
3,300 stores, plus hundreds more planned throughout 16 percent of the premium single-cup market. trust we have earned is perhaps our most precious asset. http://investor.starbucks.com Clifford Burrowspresident, Starbucks Coffee Americas and U.S. *
TBltepeownalvu gsaoeetfi r npfiyayeerregmi.anae Trrt st ’mhsfh oa eaupgr tl me toPiirtp,ref ooiwlasefirs e mntuc aoerhabe manll oenocbn nefGa ge:orrelkuosre rw o dtshftu hoedc,onic si rentayrs iwssbbt hcuuraiattc itnoahe ngbtwr.ie uceI e sapwe mgloaer nnuop, lw rditnoh t uhtehd e Atrsdoeoess ilswpaicc eeaaPc ltameetci naoibfigyuac rbl—a abennwr dclao eenrc, ed aawflr’lseeley cc meroteisnralteesga tvb aeratelritnisgrnthii.bgo Wtu nrttuhaheseles t c ,nta urw nawshdnteois c emfshext srrpea ikaenbenrsl tdeutish raceeisbu,s l iwttliuhthyreiel es ToSdmthueaarrldiro ccbeuiuou gswcuhtksiot s chmc rR oeneelaadrfsttr iu’eev nrsneahee lnee rgegrdsrwyse™ . de pTbnrrhieo nivdske susr cuatmgse,m sw,e er awree imnteroetdinugce md ore of AGolTehrsrngo isswaw oanetlif hoz cha ontutoenimo tmbinnae,anu cwkietoee ymts, o a noe reoe uaxt r c e tjpoucruasumrltty tmew np eoihterutersernf doi Bni rtltcm uoirsee a lpcdenoaricbindenlviyt-n ed fpgonrir irvtoe hePnurnrtdoo og.ufirlgto aehbba talshely e . IDTCPnrOoedalm neoBspipotfetuxeent r4 e d&A3res 0gThn0oeat6un rAecth ued iLtLoPrs JCMJLKoeuauifhcclrfeynht nHi esLC alHeGluneeola sv GlHrbmenaeereesrlprsmsrryseepeesxprnxieerdieescoeciusrdnui tdveittvi,ine cveSntee ,tvt apSv,i rcirtCbceaeheu rspa bicpdrnukerensecsn kesiCdtislod, eD Ccfenfehonetvif,teef e,Pe flCg eaoihenr pEtnifmnnMoeaerreEm raan AlRnat c *edtaoi s noAuodnnsu isEoracemf ePfl iseaac rncegirdfii ncs ge* c B reratnardys **
company has opportunities for continued growth coffee extract, available At Starbucks our aspiration is nothing less than to be Providence, RI 02940-3006 Arthur Rubinfeld chief creative officer;
[phone] president, Global Development and Evolution Fresh Retail
Starbucks consolidated global revenues reached a everywhere we do business. That includes the 36 in cans, as an instant among the most enduring brands of our time. I am https://www-us.computershare.com/investor Craig Russellsenior vice president, Global Coffee
rgercoowrtdh $ d1r3iv.3e nb ibllyio an ,7 a p 1e4r cpeenrtc erinset iinnc greloabsea,l wcoitmh preavreanbulee cyeoaurn atrnieds w inh eErMe EwAe, cwohnetirneu ree vtoen aupepsl yg rleesws o9n ps eorfc ethnet last bhaenvdercargafet,e adn idn our cjooinnifindge unst wone tahries ojonu trhnaety .path, and I thank you for AMnanrcuha l2 M0, e2e0t1i3ng of Shareholders BVliaveirk T Vayalromraseenxieocru vtiicvee pvricees ipdreensti,d cehnite,f P cuobmlimc Aufnfiatiyr sofficer
store sales and a 50 percent rise in revenue from past to reconnect with our customers in this stores. And we 10:00 a.m. PDT * executive officer
Channel Development. Our operating income was economically challenged but important region. continue to delight Marion Oliver McCaw Hall
$2 billion, a 16 percent increase, with our consolidated As the equity of our brand thrives around the world, we with seasonal coffee Seattle, WA
operating margin rising to 15 percent, up 20 basis anticipate having 20,000 stores on six continents by beverages such as Live webcast at: http://investor.starbucks.com
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Strengthening Connections. As always, our 200,000 who prefer a lighter roast. Warm regards, Global Responsibility report. Please see Starbucks fiscal Keurig and K-Cup are trademarks of Keurig, Incorporated,
While we are proud of our achievements, we have partners (employees) are working hard, crafting perfect 2012 report, available online, this spring at http://www. used with permission. K-Cup® packsfor use in Keurig®
learned never to take our success for granted, which is beverages, and fostering the personal relationships Meanwhile, three strategic acquisitions are starbucks.com/GRreport. K-Cup® Brewing Systems.
why three primary attributes will continue to drive our with customers that distinguish our brand. As consumer bringing bold upgrades to our food and
every decision and action. First, we will remain behavior continues to shift, we are further translating Howard Schultz
committed to our coffee core. Second, we will exercise our connective spirit beyond the walls of our stores by chairman, president
2012,
relevant, timely, and courageous innovation. And third, leveraging a combination of social and digital media, Mumbai, our first store in India and chief executive officer
we will ceaselessly honor our values. I firmly believe that our loyalty and Card program, and mobile technologies. non-coffee beverage categories. With La Boulange® Market Information Board of Directors
the ability to adhere to these attributes is what defines It is hard to overstate the collective power of Starbucks bakery products, we have begun the transformation of the
and Senior Leadership Team
the most enduring organizations of our time, and as I 54 million Facebook fans, 3 million Twitter followers, selection, taste, and quality of the fresh food in our stores.
share them with you in the context of highlights from 14.6 million loyalty program members, and 7 million users Second, adding Evolution Fresh to our brand portfolio
Starbucks past year, I think you will agree that they of our mobile applications, who pay this way 2 million fulfills our commitment to health and wellness, and not just
are key to our ongoing success. times each week. We also gave our customers another by bringing high-quality premium juices to our customers
Starbucks common stock is traded on the NASDAQ Global Board of Directors
quick, mobile way to pay by forging a partnership with but by extending the Evolution Fresh brand to an exciting
Staying True to Our Core Purpose Square. We will not stop innovating on this front, where new store concept. With Evolution Fresh™ juice products Sfoellleocwti nMga trakbetle ( “sNhoAwSDs AthQe” q),u uanrtdeerrly t hheig shy amnbdo llo SwB sUaXle. The HSotawrbaurdck Ss cChourpltozration, chairman, president and chief executive officer
and Capabilities as We Grow our best-in-class digital reach, and more notably the currently in more than 2,200 Starbucks® stores as well as prices per share of Starbucks common stock for each
William W. Bradley
authentic engagement we ignite daily with millions of 1,500 grocery locations, we are on our way toward quarter during the last two fiscal years and the quarterly Allen & Company LLC, managing director
We will always be a coffee company cash dividend declared per share of its common stock
consumers online, will continue to drive our core business. nationwide distribution. Robert M. Gates
whose core business is to ethically during the periods indicated:
Former Secretary of Defense
source and roast the highest-quality Coffee and connection will always be the heart of Finally, with the acquisition of the high-end Teavana brand,
Cash Dividends Mellody Hobson
arabica coffee in the world, as we Starbucks, yet our ability to reinvigorate our business we’ll apply our competencies in retail operations and hot Fiscal 2012 High Low Declared Ariel Investments, LLC, president
simultaneously create authentic around that heritage remains an unmatched competitive and cold beverage creation to expand Teavana’s 300-store Fourth Quarter $54.28 $43.04 $0.21 Kevin R. Johnson
connections with our customers and the advantage. footprint as we reinvent the tea category, in part by Third Quarter 62.00 51.03 0.17 Juniper Networks, Inc., chief executive officer
1971, communities we serve. I assure you we bringing tea bars into Teavana stores and applying Second Quarter 56.55 45.28 0.17 Olden Lee
are not deviating from this purpose but Innovating with Timely Relevance, learnings from our own Tazo brand. Long term, our intent First Quarter 46.50 35.12 0.17 PepsiCo, Inc., retired executive
OPiuker fiPrlsatc est Moraer koeptens in Seattle's rather enhancing it with extreme diligence. Courage, and Conviction is to significantly grow Teavana’s global store presence, Fiscal 2011 High Low Cash DDiveicdleanredds JoKsishsuinag eCr oAosspoecria Rteasm, Inoc., vice chairman
Scaling the Starbucks Experience. Today, 42 years after Last year also saw significant product innovation around transforming tea just as we have transformed coffee. Fourth Quarter $42.00 $33.72 $0.17 James G. Shennan, Jr.
Dear Shareholders, opening our first store in Seattle, Starbucks operates in our coffee core, most notably in the $8 billion premium Our pace of innovation and creativity is rapid, and I assure Third Quarter 40.26 34.61 0.13 Trinity Ventures, general partner emeritus
61 countries, and we recently had our most successful single-cup category. you that every move is highly strategic and thoughtfully Second Quarter 38.21 30.75 0.13 Clara Shih
It is an honor to write you this First Quarter 33.15 25.37 0.13 Hearsay Social, Inc., chief executive officer
year, not only because we have launch ever, in India. I was in Mumbai when our doors We reached a true milestone with the launch of the executed as we push for relevant, timely, and disciplined Javier G. Teruel
apcehrfieovrmeda nrecceo brdu tfi bneacnacuiasle we obpuseinneedss, apnadrt nI pere irns oInndalilay, wTaittnae Gssloebda, lw Bitehv eoruarg feans,t athseti c tbheaatu hteifrual lVdes rtihsme ofir®s St ytismteem c,u as tbormeaekrsth craonu gmha tkeec Shtnaorlbougcyk s® raenidnv beenytoionnd i.n our stores, in consumer product channels, TfInilhivneeg scsto ommr aRpyea lbnayet’i soo nUbst. Sas.ie nSceetdico uwnr iiotthife otshu aet n ccdho aEmrxgpceah nbayny’ gsa ecw cCeebossmsiitnmeg ia sttsh ieo n MCyorlogant eE-.P aUlmllmolaivne, CIIoImpany, retired vice chairman
have once again done so by living unabashed affection and demand for Starbucks, a brewed or latte beverages in their homes. This is only the Honoring Our Culture’s Values http://investor.starbucks.com, at http://sec.gov, or by U.S. and International retail chief executive officer (retired)
ubpal aton ctihneg h perroitfiatgs ew oitfh o au rs occoimal pcaonnys,c ience. Our dtheefi nwiotirvled .signal that our brand is resonating around bVeergisinmnoin bgr aasn dw ein etom tbhaer kle oadn ian gm pullatityfeoarmr p ilna nth teo sginrogwle -tchuep and Guiding Principles madadkriensgs a, prehqounee snt utom Ibnevre ostro wr eRbeslaitteio lnisst ethdr boueglohw t.he CPreapigsi -EC.o Wla eCaomthpearnuyp, retired chief executive officer
commitment to creating shareholder value through In the China and Asia Pacific region in 2012, we once space, where sales of our other, complementary single- More than ever, today’s consumers have an interest in and Starbucks Coffee Company Senior Leadership Team
the lens of humanity is truly a cornerstone of Starbucks again posted strong annual returns, including 11 serve offerings are also accelerating. In 2012 Starbucks access to what companies stand for—their values. This is Investor Relations, Mailstop: EX4 Howard Schultzchairman, president and chief executive officer *
global strength, especially as we pursue the most consecutive quarters of double-digit comparable store VIA® Ready Brew sales grew significantly and we shipped nothing new to Starbucks. We’ve been building a company PO Box 34067 Troy Alsteadchief financial officer and chief administrative officer *
Seattle, WA 98124-1067
ambitious agenda in our company’s history. sales growth. This success showcases how—with nearly nearly 500 million K-Cup® packs, garnering approximately with a conscience for four decades, and the reservoir of [phone] Adam Brotmansenior vice president, chief digital officer
3,300 stores, plus hundreds more planned throughout 16 percent of the premium single-cup market. trust we have earned is perhaps our most precious asset. http://investor.starbucks.com Clifford Burrowspresident, Starbucks Coffee Americas and U.S. *
TBltepeownalvu gsaoeetfi r npfiyayeerregmi.anae Trrt st ’mhsfh oa eaupgr tl me toPiirtp,ref ooiwlasefirs e mntuc aoerhabe manll oenocbn nefGa ge:orrelkuosre rw o dtshftu hoedc,onic si rentayrs iwssbbt hcuuraiattc itnoahe ngbtwr.ie uceI e sapwe mgloaer nnuop, lw rditnoh t uhtehd e Atrsdoeoess ilswpaicc eeaaPc ltameetci naoibfigyuac rbl—a abennwr dclao eenrc, ed aawflr’lseeley cc meroteisnralteesga tvb aeratelritnisgrnthii.bgo Wtu nrttuhaheseles t c ,nta urw nawshdnteois c emfshext srrpea ikaenbenrsl tdeutish raceeisbu,s l iwttliuhthyreiel es ToSdmthueaarrldiro ccbeuiuou gswcuhtksiot s chmc rR oeneelaadrfsttr iu’eev nrsneahee lnee rgegrdsrwyse™ . de pTbnrrhieo nivdske susr cuatmgse,m sw,e er awree imnteroetdinugce md ore of AGolTehrsrngo isswaw oanetlif hoz cha ontutoenimo tmbinnae,anu cwkietoee ymts, o a noe reoe uaxt r c e tjpoucruasumrltty tmew np eoihterutersernf doi Bni rtltcm uoirsee a lpcdenoaricbindenlviyt-n ed fpgonrir irvtoe hePnurnrtdoo og.ufirlgto aehbba talshely e . IDTCPnrOoedalm neoBspipotfetuxeent r4 e d&A3res 0gThn0oeat6un rAecth ued iLtLoPrs JCMJLKoeuauifhcclrfeynht nHi esLC alHeGluneeola sv GlHrbmenaeereesrlprsmsrryseepeesxprnxieerdieescoeciusrdnui tdveittvi,ine cveSntee ,tvt apSv,i rcirtCbceaeheu rspa bicpdrnukerensecsn kesiCdtislod, eD Ccfenfehonetvif,teef e,Pe flCg eaoihenr pEtnifmnnMoeaerreEm raan AlRnat c *edtaoi s noAuodnnsu isEoracemf ePfl iseaac rncegirdfii ncs ge* c B reratnardys **
company has opportunities for continued growth coffee extract, available At Starbucks our aspiration is nothing less than to be Providence, RI 02940-3006 Arthur Rubinfeld chief creative officer;
[phone] president, Global Development and Evolution Fresh Retail
Starbucks consolidated global revenues reached a everywhere we do business. That includes the 36 in cans, as an instant among the most enduring brands of our time. I am https://www-us.computershare.com/investor Craig Russellsenior vice president, Global Coffee
rgercoowrtdh $ d1r3iv.3e nb ibllyio an ,7 a p 1e4r cpeenrtc erinset iinnc greloabsea,l wcoitmh preavreanbulee cyeoaurn atrnieds w inh eErMe EwAe, cwohnetirneu ree vtoen aupepsl yg rleesws o9n ps eorfc ethnet last bhaenvdercargafet,e adn idn our cjooinnifindge unst wone tahries ojonu trhnaety .path, and I thank you for AMnanrcuha l2 M0, e2e0t1i3ng of Shareholders BVliaveirk T Vayalromraseenxieocru vtiicvee pvricees ipdreensti,d cehnite,f P cuobmlimc Aufnfiatiyr sofficer
store sales and a 50 percent rise in revenue from past to reconnect with our customers in this stores. And we 10:00 a.m. PDT * executive officer
Channel Development. Our operating income was economically challenged but important region. continue to delight Marion Oliver McCaw Hall
$2 billion, a 16 percent increase, with our consolidated As the equity of our brand thrives around the world, we with seasonal coffee Seattle, WA
operating margin rising to 15 percent, up 20 basis anticipate having 20,000 stores on six continents by beverages such as Live webcast at: http://investor.starbucks.com
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Strengthening Connections. As always, our 200,000 who prefer a lighter roast. Warm regards, Global Responsibility report. Please see Starbucks fiscal Keurig and K-Cup are trademarks of Keurig, Incorporated,
While we are proud of our achievements, we have partners (employees) are working hard, crafting perfect 2012 report, available online, this spring at http://www. used with permission. K-Cup® packsfor use in Keurig®
learned never to take our success for granted, which is beverages, and fostering the personal relationships Meanwhile, three strategic acquisitions are starbucks.com/GRreport. K-Cup® Brewing Systems.
why three primary attributes will continue to drive our with customers that distinguish our brand. As consumer bringing bold upgrades to our food and
every decision and action. First, we will remain behavior continues to shift, we are further translating Howard Schultz
committed to our coffee core. Second, we will exercise our connective spirit beyond the walls of our stores by chairman, president
2012,
relevant, timely, and courageous innovation. And third, leveraging a combination of social and digital media, Mumbai, our first store in India and chief executive officer
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-K
(cid:95)(cid:3)ANNUAL REPORT PURSUANT TO SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934(cid:3)
For the Fiscal Year Ended September30, 2012
or
(cid:133)(cid:3)TRANSITION REPORT PURSUANT TO SECTION13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934(cid:3)
For the transition period from to .
Commission File Number: 0-20322
Starbucks Corporation
(Exact Name of Registrant as Specified in its Charter)
Washington 91-1325671
(State of Incorporation) (IRS Employer ID)
2401 Utah Avenue South, Seattle, Washington 98134
[phone]
(Address of principal executive offices, zip code, telephonenumber)
Securities Registered Pursuant to Section12(b) of the Act:
Title of Each Class Name of Each Exchange on Which Registered
Common Stock, $0.001par value per share Nasdaq Global Select Market
Securities Registered Pursuant to Section12(g) of the Act:None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes (cid:95) No (cid:133)
Indicate by check mark if the registrant is not required to file reports pursuant to Section13 or Section15(d) of the Act. Yes (cid:133) No (cid:95)
Indicate by check mark whether the registrant: (1)has filed all reports required to be filed by Section13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12months (or for such shorter period that the registrant was required to file such reports), and (2)has been
subject to such filing requirements for the past 90days. Yes (cid:95) No (cid:133)
Indicate by check mark whether the registrant has submitted electronically and posted on its corporateWeb site, if any, every Interactive Data
File required to be submitted and posted pursuant to Rule405 of RegulationS-T (§232.405 of this chapter) during the preceding 12months
(or for such shorter period that the registrant was required to submit and post such files). Yes (cid:95) No (cid:133)
Indicate by check mark if disclosure of delinquent filers pursuant to Item405 of Regulation of S-K (§ 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by
reference in PartIII of this Form 10-K or any amendment to this Form10-K. (cid:133)
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule12b-2 of the Exchange
Act. (Check one):
Largeacceleratedfiler (cid:95)(cid:3) Acceleratedfiler (cid:133)
Non-accelerated filer (cid:133) (Do not check if a smaller reporting company) Smallerreportingcompany (cid:133)
Indicate by check mark whether the registrant is a shell company (as defined in Rule12b-2 of the Exchange Act). Yes (cid:133) No (cid:95)
The aggregate market value of the voting stock held by non-affiliates of the registrant as of the last business day of the registrant’s most
recently completed second fiscal quarter, based upon the closing sale price of the registrant’s common stock on March30, 2012as reported on
the NASDAQ Global Select Market was $41 billion. As of November9, 2012, there were 743.6 millionshares of the registrant’s Common
Stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive Proxy Statementfor the registrant’s Annual Meeting of Shareholders to be held on March20, 2013have been
incorporated by reference into PartIII of this Annual Report on Form10-K.
STARBUCKS CORPORATION
Form10-K
For the Fiscal Year Ended September30, 2012
TABLE OF CONTENTS
PARTI
Item1 Business 2
Item1A Risk Factors 10
Item1B Unresolved Staff Comments 17
Item2 Properties 17
Item3 Legal Proceedings 17
Item4 Mine Safety Disclosures 18
PARTII
Item5 Market for the Registrant’s Common Equity, Related Shareholder Matters and Issuer
Purchases of Equity Securities 19
Item6 Selected Financial Data 22
Item7 Management’s Discussion and Analysis of Financial Condition and Results of Operations 25
Item7A Quantitative and Qualitative Disclosures About Market Risk 49
Item8 Financial Statements and Supplementary Data 50
Report of Independent Registered Public Accounting Firm 89
Item9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 90
Item9A Controls and Procedures 90
Item9B Other Information 92
PARTIII
Item10 Directors, Executive Officers and Corporate Governance 93
Item11 Executive Compensation 93
Item12 Security Ownership of Certain Beneficial Owners and Management and Related Shareholder
Matters 93
Item13 Certain Relationships and Related Transactions, and Director Independence 93
Item14 Principal Accountant Fees and Services 93
PARTIV
Item15 Exhibits, Financial Statement Schedules 94
SIGNATURES 95
INDEX TO EXHIBITS 97
CAUTIONARY NOTEREGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K includes “forward-looking” statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do
not relate strictly to historical or current facts. They often include words such as “believes,” “expects,”
“anticipates,” “estimates,” “intends,” “plans,” “seeks” or words of similar meaning, or future or conditional verbs,
such as “will,” “should,” “could,” “may,” “aims,” “intends,” or “projects.” A forward-looking statement is neither
a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not
occur. You should not place undue reliance on forward-looking statements, which speak only as of the date of this
Annual Report on Form 10-K. These forward-looking statements are all based on currently available operating,
financial and competitive information and are subject to various risks and uncertainties. Our actual future results
and trends may differ materially depending on a variety of factors, including, but not limited to, the risks and
uncertainties discussed under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations”. Given these risks and uncertainties, you should not rely on forward-looking
statements as a prediction of actual results. Any or all of the forward-looking statements contained in this Annual
Report on Form 10-K and any other public statement made by us, including by our management, may turn out to
be incorrect. We are including this cautionary note to make applicable and take advantage of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements. We expressly
disclaim any obligation to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
1
PARTI
Item 1. Business
General
Starbucks is the premier roaster, marketer and retailer of specialty coffee in the world, operating in 60countries.
Formed in 1985, Starbucks Corporation’s common stock trades on the NASDAQ Global Select Market
(“NASDAQ”) under the symbol “SBUX.” We purchase and roast high-quality coffees that we sell, along with
handcrafted coffee, tea and other beverages and a variety of fresh food items, through company-operated stores.
We also sell a variety of coffee and tea products and license our trademarks through other channels such as
licensed stores, grocery and national foodservice accounts. In addition to our flagship Starbucks brand, our
portfolio also includes Tazo®Tea, Seattle’s Best Coffee®, Starbucks VIA®Ready Brew, Starbucks Refreshers™
beverages, Evolution Fresh™, La Boulange bakery brand and the Verismo™ System by Starbucks.
Our objective is to maintain Starbucks standing as one of the most recognized and respected brands in the world.
To achieve this goal, we are continuing the disciplined expansion of our global store base. In addition, by
leveraging the experience gained through our traditional store model, we continue to offer consumers new coffee
products in a variety of forms, across new categories, and through diverse channels. Starbucks Global
Responsibility strategy and commitments related to coffee and the communities we do business in, as well as our
focus on being an employer of choice, are also key complements to our business strategies.
In this Annual Report on Form10-K (“10-K” or “Report”) for the fiscal year ended September30, 2012(“fiscal
2012”), Starbucks Corporation (together with its subsidiaries) is referred to as “Starbucks,” the “Company,”
“we,” “us” or “our.”
Segment FinancialInformation
Segment information is prepared on the same basis that our management reviews financial information for
operational decision-making purposes. Beginning with the first quarter of fiscal 2012, we redefined our
reportable operating segments to align with the three-region leadership and organizational structure of our retail
business that took effect at the beginning of fiscal 2012.
The three-region structure includes: 1) Americas, inclusive of the US, Canada, and Latin America; 2) Europe,
Middle East, and Africa, collectively referred to as the “EMEA” region; and 3) China / Asia Pacific (“CAP”).
Our chief executive officer, who is our chief operating decision maker, manages these businesses, evaluates
financial results, and makes key operating decisions based on the new organizational structure. Accordingly,
beginning with the first quarter of fiscal 2012, we revised our reportable operating segments from 1) US, 2)
International, and 3) Global Consumer Products Group to the following four reportable segments: 1) Americas,
2) EMEA, 3) CAP, and 4) Global Consumer Products Group. In the second quarter of fiscal 2012, we renamed
our Global Consumer Products Group segment “Channel Development.” Segment revenues as a percentage of
total net revenues for fiscal year 2012were as follows: Americas (75%), EMEA (9%), CAP (5%), and Channel
Development (10%).
Concurrent with the change in reportable operating segments, we revised our prior period financial information
to reflect comparable financial information for the new segment structure. Historical financial information
presented herein reflects this change.
The Americas, EMEA, and CAP segments include both company-operated and licensed stores. Our Americas
segment is our most mature business and has achievedsignificant scale. Certain markets within EMEA and CAP
operations are in the early stages of development and require a more extensive support organization, relative to
the current levels of revenue and operating income, than the Americas operations. The Americas and EMEA
segments also include foodservice accounts, primarily in Canada and the UK. Our Americas segment also
includes the retail and wholesale activities of Bay Bread, LLC (doing business as La Boulange), which was
acquired in the fourth quarter of fiscal 2012.
2
Our Channel Development segment includes whole bean and ground coffees, premium Tazo® teas, Starbucks
VIA® Ready Brew, Starbucks® coffee and Tazo® tea K-Cup® portion packs, a variety of ready-to-drink
beverages, such as Starbucks Refreshers™ beverages, and other branded products sold worldwide through
channels such as grocery stores, warehouse clubs, convenience stores, and US foodservice accounts.
Seattle’s Best Coffee is reported in “Other” along with Evolution Fresh, Digital Ventures and unallocated
corporate expenses that pertain to corporate administrative functions that support our operating segments but are
not specifically attributable to or managed by any segment and are not included in the reported financial results
of the operating segments. The Other category comprised approximately 1%of total net revenues.
Financial information for Starbucks reportable operating segments and Other is included in Note 17 to the
consolidated financial statements included in Item 8 of this 10-K.
Revenue Components
We generate our revenues through company-operated stores, licensed stores, consumer packaged goods ("CPG")
and foodservice operations.
Company-operated and Licensed Store Summary as of September30, 2012
Asa%of Asa%of Asa%of
Total Total Total Asa%of
Americas EMEA CAP Total
Americas Stores EMEA Stores CAP Stores Total Stores
Company-operated
stores 7,857 61% 882 47% 666 20% 9,405 52%
Licensed stores 5,046 39% 987 53% 2,628 80% 8,661 48%
Total 12,903 100% 1,869 100% 3,294 100% 18,066 100%
The mix of company-operated versus licensed stores in a given market will vary based on several factors,
including the ability to access desirable local retail space, the complexity and expected ultimate size of the
market for Starbucks, and the ability to leverage the support infrastructure in an existing geographic region.
Company-operated Stores
Revenue from company-operated stores accounted for 79% of total net revenues during fiscal 2012. Our retail
objective is to be the leading retailer and brand of coffee in each of our target markets by selling the finest
quality coffee and related products, and by providing each customer a unique Starbucks Experience. The
Starbucks Experience is built upon superior customer service as well as clean and well-maintained company-
operated stores that reflect the personalities of the communities in which they operate, thereby building a high
degree of customer loyalty.
Our strategy for expanding our global retail business is to increase our market share in a disciplined manner, by
selectively opening additional stores in new and existing markets, as well as increasing sales in existing stores,
to support our long-term strategic objective to maintain Starbucks standing as one of the most recognized and
respected brands in the world. Store growthin specific existing markets will vary due to many factors, including
the maturity of the market.
3
The following is a summary of total company-operated store data for the periods indicated:
NetStoresOpened
(Closed)Duringthe
(1)
FiscalYearEnded Stores Open as of
Sep30, Oct2, Sep30, Oct2,
2012 2011 2012 2011
Americas:
US 161 (2) 6,866 6,705
Canada 42 37 878 836
Chile 6 5 41 35
Brazil 25 5 53 28
Puerto Rico — (2) 19 19
Total Americas 234 43 7,857 7,623
EMEA:
UK (7) 5 593 600
Germany 7 8 157 150
France 5 8 67 62
Switzerland 4 — 50 46
Austria — 2 12 12
Netherlands 1 2 3 2
Total EMEA 10 25 882 872
CAP:
China 130 58 408 278
Thailand 14 8 155 141
Singapore 8 8 80 72
Australia 2 (1) 23 21
Total CAP 154 73 666 512
Total company-operated 398 141 9,405 9,007
(1) Store openings are reported net of closures. In the Americas, 279 and 100 company-operated stores were
opened during 2012 and 2011, respectively, and 45 and 57 stores were closed during 2012 and 2011,
respectively. In EMEA, 27 and 41 company-operated stores were opened during 2012 and 2011,
respectively, and 17 and 16 stores were closed during 2012 and 2011, respectively. In CAP, 161 and 87
company-operated stores were opened during 2012 and 2011, respectively, and 7 and 14 stores were
closed during 2012and 2011, respectively.
Starbucks company-operated stores are typically located in high-traffic, high-visibility locations. Our ability to
vary the size and format of our stores allows us to locate them in or near a variety of settings, including
downtown and suburban retail centers, office buildings, university campuses, and in select rural and off-highway
locations. To provide a greater degree of access and convenience for non-pedestrian customers, we continue to
selectively expand development of drive-thru stores.
Starbucks stores offer a choice of regular and decaffeinated coffee beverages, a broad selection of Italian-style
espresso beverages, cold blended beverages, iced shaken refreshment beverages, a selection of premium Tazo®
teas, distinctively packaged roasted whole bean and ground coffees, a variety of Starbucks VIA® Ready Brew
soluble coffees, Starbucks® coffee and Tazo® tea K-Cup® portion packs, Starbucks Refreshers™ beverages,
juices and bottled water. Starbucks stores also offer an assortment of fresh food items, including selections
4