Stock Analysis on Net
Stock Analysis on Net

Starbucks Corp. (NASDAQ:SBUX)

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

Starbucks Corp., income tax expense (benefit), continuing operations

US$ in thousands

Microsoft Excel
12 months ended: Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
U.S. federal 678,200 477,600 681,800 49,900 1,414,300 156,200
U.S. state and local 235,900 164,000 190,000 36,900 447,800 52,000
Foreign 422,400 283,800 409,800 181,400 458,300 327,000
Current taxes 1,336,500 925,400 1,281,600 268,200 2,320,400 535,200
U.S. federal 117,000 92,600 10,400 (8,400) (1,074,500) 633,700
U.S. state and local (800) 10,500 (6,400) (4,800) (322,400) 101,500
Foreign (175,500) (80,000) (129,000) (15,300) (51,900) (8,400)
Deferred taxes (59,300) 23,100 (125,000) (28,500) (1,448,800) 726,800
Income tax expense 1,277,200 948,500 1,156,600 239,700 871,600 1,262,000

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Current taxes Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Starbucks Corp. current taxes decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Deferred taxes Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Starbucks Corp. deferred taxes increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.
Income tax expense Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Starbucks Corp. income tax expense decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Effective Income Tax Rate (EITR)

Starbucks Corp., effective income tax rate (EITR) reconciliation

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Statutory U.S. federal income tax rate 21.00% 21.00% 21.00% 21.00% 21.00% 24.50%
State income taxes, net of federal tax benefit 3.40% 3.30% 2.70% 2.20% 2.10% 2.10%
Foreign rate differential 0.40% 0.30% 0.50% -3.20% -0.10% -0.10%
Change in tax rates 0.00% 0.00% -1.30% -2.20% 0.00% 0.00%
Residual tax on foreign earnings 0.00% 0.00% 0.00% 0.00% 1.70% 0.00%
Tax impacts related to sale of certain operations 0.00% 0.00% 0.00% 0.00% -1.30% 0.00%
Gain resulting from acquisition of joint venture 0.00% 0.00% 0.00% 0.00% 0.00% -5.80%
Other, net -1.20% -2.20% -1.30% 2.80% -3.90% -1.70%
Effective income tax rate, before impact of the Tax Act 23.60% 22.40% 21.60% 20.60% 19.50% 19.00%
Impact of the Tax Act 0.00% 0.00% 0.00% 0.00% 0.00% 2.80%
Effective income tax rate 23.60% 22.40% 21.60% 20.60% 19.50% 21.80%

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Effective income tax rate, before impact of the Tax Act Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Starbucks Corp. effective income tax rate, before impact of the Tax Act increased from 2021 to 2022 and from 2022 to 2023.

Components of Deferred Tax Assets and Liabilities

Starbucks Corp., components of deferred tax assets and liabilities

US$ in thousands

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Operating lease liabilities 2,395,300 2,289,100 2,395,200 2,313,000 — —
Stored value card liability and deferred revenue 1,638,100 1,662,600 1,679,400 1,678,600 1,649,000 144,200
Intangible assets and goodwill 313,400 313,600 317,700 248,600 230,000 —
Accrued occupancy costs — — — — 121,600 109,000
Other 642,300 605,700 641,000 554,400 413,000 437,000
Deferred tax assets 4,989,100 4,871,000 5,033,300 4,794,600 2,413,600 690,200
Valuation allowance (148,600) (228,700) (275,300) (239,400) (75,100) (129,300)
Deferred tax asset, net of valuation allowance 4,840,500 4,642,300 4,758,000 4,555,200 2,338,500 560,900
Operating lease, right-of-use assets (2,291,800) (2,194,300) (2,296,500) (2,191,800) — —
Property, plant and equipment (525,400) (482,200) (451,200) (463,300) (400,900) (348,100)
Other (268,100) (284,700) (284,000) (268,300) (358,200) (348,300)
Deferred tax liabilities (3,085,300) (2,961,200) (3,031,700) (2,923,400) (759,100) (696,400)
Net deferred tax asset (liability) 1,755,200 1,681,100 1,726,300 1,631,800 1,579,400 (135,500)

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Deferred tax assets Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Starbucks Corp. deferred tax assets decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.
Deferred tax asset, net of valuation allowance Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Starbucks Corp. deferred tax asset, net of valuation allowance decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Net deferred tax asset (liability) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Starbucks Corp. net deferred tax asset (liability) decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Deferred Tax Assets and Liabilities, Classification

Starbucks Corp., deferred tax assets and liabilities, classification

US$ in thousands

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Deferred income tax assets 1,769,800 1,799,700 1,874,800 1,789,900 1,765,800 134,700
Deferred income tax liabilities (included in Other long-term liabilities) 14,600 118,600 148,500 158,100 186,400 270,200

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Deferred income tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Starbucks Corp. deferred income tax assets decreased from 2021 to 2022 and from 2022 to 2023.
Deferred income tax liabilities (included in Other long-term liabilities) Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Starbucks Corp. deferred income tax liabilities (included in Other long-term liabilities) decreased from 2021 to 2022 and from 2022 to 2023.

Adjustments to Financial Statements: Removal of Deferred Taxes

Starbucks Corp., adjustments to financial statements

US$ in thousands

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Adjustment to Total Assets
Total assets (as reported) 29,445,500 27,978,400 31,392,600 29,374,500 19,219,600 24,156,400
Less: Noncurrent deferred tax assets, net 1,769,800 1,799,700 1,874,800 1,789,900 1,765,800 134,700
Total assets (adjusted) 27,675,700 26,178,700 29,517,800 27,584,600 17,453,800 24,021,700
Adjustment to Total Liabilities
Total liabilities (as reported) 37,433,300 36,677,100 36,707,100 37,173,900 25,450,600 22,980,600
Less: Noncurrent deferred tax liabilities, net 14,600 118,600 148,500 158,100 186,400 270,200
Total liabilities (adjusted) 37,418,700 36,558,500 36,558,600 37,015,800 25,264,200 22,710,400
Adjustment to Shareholders’ Equity (deficit)
Shareholders’ equity (deficit) (as reported) (7,994,800) (8,706,600) (5,321,200) (7,805,100) (6,232,200) 1,169,500
Less: Net deferred tax assets (liabilities) 1,755,200 1,681,100 1,726,300 1,631,800 1,579,400 (135,500)
Shareholders’ equity (deficit) (adjusted) (9,750,000) (10,387,700) (7,047,500) (9,436,900) (7,811,600) 1,305,000
Adjustment to Net Earnings Attributable To Starbucks
Net earnings attributable to Starbucks (as reported) 4,124,500 3,281,600 4,199,300 928,300 3,599,200 4,518,300
Add: Deferred income tax expense (benefit) (59,300) 23,100 (125,000) (28,500) (1,448,800) 726,800
Net earnings attributable to Starbucks (adjusted) 4,065,200 3,304,700 4,074,300 899,800 2,150,400 5,245,100

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Starbucks Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Starbucks Corp., adjusted financial ratios

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Net Profit Margin
Reported net profit margin 11.46% 10.18% 14.45% 3.95% 13.58% 18.28%
Adjusted net profit margin 11.30% 10.25% 14.02% 3.83% 8.11% 21.22%
Total Asset Turnover
Reported total asset turnover 1.22 1.15 0.93 0.80 1.38 1.02
Adjusted total asset turnover 1.30 1.23 0.98 0.85 1.52 1.03
Financial Leverage
Reported financial leverage — — — — — 20.66
Adjusted financial leverage — — — — — 18.41
Return on Equity (ROE)
Reported ROE — — — — — 386.34%
Adjusted ROE — — — — — 401.92%
Return on Assets (ROA)
Reported ROA 14.01% 11.73% 13.38% 3.16% 18.73% 18.70%
Adjusted ROA 14.69% 12.62% 13.80% 3.26% 12.32% 21.83%

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Starbucks Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Starbucks Corp. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Starbucks Corp. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.

Starbucks Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Starbucks 4,124,500 3,281,600 4,199,300 928,300 3,599,200 4,518,300
Net revenues 35,975,600 32,250,300 29,060,600 23,518,000 26,508,600 24,719,500
Profitability Ratio
Net profit margin1 11.46% 10.18% 14.45% 3.95% 13.58% 18.28%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Starbucks 4,065,200 3,304,700 4,074,300 899,800 2,150,400 5,245,100
Net revenues 35,975,600 32,250,300 29,060,600 23,518,000 26,508,600 24,719,500
Profitability Ratio
Adjusted net profit margin2 11.30% 10.25% 14.02% 3.83% 8.11% 21.22%

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Net profit margin = 100 × Net earnings attributable to Starbucks ÷ Net revenues
= 100 × 4,124,500 ÷ 35,975,600 = 11.46%

2 Adjusted net profit margin = 100 × Adjusted net earnings attributable to Starbucks ÷ Net revenues
= 100 × 4,065,200 ÷ 35,975,600 = 11.30%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Starbucks Corp. adjusted net profit margin ratio deteriorated from 2021 to 2022 but then slightly improved from 2022 to 2023.

Adjusted Total Asset Turnover

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net revenues 35,975,600 32,250,300 29,060,600 23,518,000 26,508,600 24,719,500
Total assets 29,445,500 27,978,400 31,392,600 29,374,500 19,219,600 24,156,400
Activity Ratio
Total asset turnover1 1.22 1.15 0.93 0.80 1.38 1.02
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Net revenues 35,975,600 32,250,300 29,060,600 23,518,000 26,508,600 24,719,500
Adjusted total assets 27,675,700 26,178,700 29,517,800 27,584,600 17,453,800 24,021,700
Activity Ratio
Adjusted total asset turnover2 1.30 1.23 0.98 0.85 1.52 1.03

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Total asset turnover = Net revenues ÷ Total assets
= 35,975,600 ÷ 29,445,500 = 1.22

2 Adjusted total asset turnover = Net revenues ÷ Adjusted total assets
= 35,975,600 ÷ 27,675,700 = 1.30

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Starbucks Corp. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in thousands)
Total assets 29,445,500 27,978,400 31,392,600 29,374,500 19,219,600 24,156,400
Shareholders’ equity (deficit) (7,994,800) (8,706,600) (5,321,200) (7,805,100) (6,232,200) 1,169,500
Solvency Ratio
Financial leverage1 — — — — — 20.66
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted total assets 27,675,700 26,178,700 29,517,800 27,584,600 17,453,800 24,021,700
Adjusted shareholders’ equity (deficit) (9,750,000) (10,387,700) (7,047,500) (9,436,900) (7,811,600) 1,305,000
Solvency Ratio
Adjusted financial leverage2 — — — — — 18.41

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Financial leverage = Total assets ÷ Shareholders’ equity (deficit)
= 29,445,500 ÷ -7,994,800 = —

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted shareholders’ equity (deficit)
= 27,675,700 ÷ -9,750,000 = —

Adjusted Return on Equity (ROE)

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Starbucks 4,124,500 3,281,600 4,199,300 928,300 3,599,200 4,518,300
Shareholders’ equity (deficit) (7,994,800) (8,706,600) (5,321,200) (7,805,100) (6,232,200) 1,169,500
Profitability Ratio
ROE1 — — — — — 386.34%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Starbucks 4,065,200 3,304,700 4,074,300 899,800 2,150,400 5,245,100
Adjusted shareholders’ equity (deficit) (9,750,000) (10,387,700) (7,047,500) (9,436,900) (7,811,600) 1,305,000
Profitability Ratio
Adjusted ROE2 — — — — — 401.92%

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 ROE = 100 × Net earnings attributable to Starbucks ÷ Shareholders’ equity (deficit)
= 100 × 4,124,500 ÷ -7,994,800 = —

2 Adjusted ROE = 100 × Adjusted net earnings attributable to Starbucks ÷ Adjusted shareholders’ equity (deficit)
= 100 × 4,065,200 ÷ -9,750,000 = —

Adjusted Return on Assets (ROA)

Microsoft Excel
Oct 1, 2023 Oct 2, 2022 Oct 3, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Starbucks 4,124,500 3,281,600 4,199,300 928,300 3,599,200 4,518,300
Total assets 29,445,500 27,978,400 31,392,600 29,374,500 19,219,600 24,156,400
Profitability Ratio
ROA1 14.01% 11.73% 13.38% 3.16% 18.73% 18.70%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Starbucks 4,065,200 3,304,700 4,074,300 899,800 2,150,400 5,245,100
Adjusted total assets 27,675,700 26,178,700 29,517,800 27,584,600 17,453,800 24,021,700
Profitability Ratio
Adjusted ROA2 14.69% 12.62% 13.80% 3.26% 12.32% 21.83%

Based on: 10-K (reporting date: 2023-10-01), 10-K (reporting date: 2022-10-02), 10-K (reporting date: 2021-10-03), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 ROA = 100 × Net earnings attributable to Starbucks ÷ Total assets
= 100 × 4,124,500 ÷ 29,445,500 = 14.01%

2 Adjusted ROA = 100 × Adjusted net earnings attributable to Starbucks ÷ Adjusted total assets
= 100 × 4,065,200 ÷ 27,675,700 = 14.69%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Starbucks Corp. adjusted ROA deteriorated from 2021 to 2022 but then improved from 2022 to 2023 exceeding 2021 level.