Starbucks reported an acceptable earnings picture for Q4 to Wall Street Thursday: strong US sales, weaker margins due to cost inflation and their partner and equipment upgrades; negative but sequentially better results in China due to COVID restrictions, and strong results in other international markets. Of the results that matter most to us, US comps were up 11%, with average ticket up 10% and traffic up only 1%. The stock was up 3% in the brief after hours look. On the call, CEO Howard Schultz noted the US had taken 6% price, so the balance in the ticket increase was a mix of marketing actions and people still buying multiple food units per transaction. However, store level margins were down approximately 2% due to the cost pressure. On the call, company executives took considerable time to tout the new wage, training and benefit investments to employee associates as well as many new equipment pieces designed to ease and customize beverage flow. About $2 billion was invested in FY22 and FY23 altogether! Also, the succession plan for the new CEO is still on track, although Schultz did not speak about it on this call. In response to a question about the fear of an upcoming recession on Starbuck’s sales, he responded that digital sales and the rewards program along with the younger age mix of the Starbucks guest ordering unique beverage combinations provided for some sales security. Looking further out, the huge global single focused publicly traded brands – McDonalds and Starbucks – seen to have consolidated their position in the last two years. In a nutshell, the big are getting bigger and more powerful!