Starbucks (SBUX) revealed their Quarter 1 2022 earnings on Tuesday. They delivered a small revenue beat but missed Q1 earnings by $.08. More significantly, they lowered earnings for the rest of 2022, and noted they would not be back to their long-term earnings profile of 18 to 19% operating income margin until 2024. 2022 will now be pretty much of a lost year. All restaurants are having cost problems right now; Starbucks is not the first. The deepness of the Starbucks profit gap is driven by food and paper commodity increases (they would not specify how much), investments in staff training and wage increases announced last quarter ($1 Billion in total) as well as COVID sick pay. From the just released SEC 10Q document, it seems to be that the Starbucks North American company store EBITDA margin was 19.2% vs. 20.8% in Q1 2021. North America and US sales were great: same store sales were plus 18%, with 12% from increased traffic. That is a welcome turnaround. Starbucks took price increases on October 1 and January 1 with no negative impact felt. It will be cutting G&A such as low ROI marketing and promotional expense, and continuing to work in store efficiency measures not involving cutting hours. It has a new branded energy drink ready to go in FY-22, called Via. Management noted again rural and suburban stores were up nicely, urban edge stores were recovering. There was $3 billion in new Rewards cards reloads and signups. North American store counts for the year were flat but they continue to switch out older stores for better locations. In other Starbuck news, SEC filings indicate that CEO Kevin Johnson personally enjoyed a banner year – notwithstanding union successes in 2 of 3 stores with many more on the way and the above reported challenges – his 2021 compensation rose by almost 40% to a little over $20 million, while a promotion from EVP to CFO helped bump Rachel Ruggeri‘s compensation by 60% and COO John Culver settled for a 45% increase in total compensation.