MW Starbucks launches delivery in San Francisco with more major U.S. cities to come

Starbucks Corp. (SBUX) is launching delivery service in San Francisco on Tuesday, and will expand the service to Boston, Chicago, Los Angeles, New York and Washington DC in the coming weeks. The expansion comes after a pilot in Miami. Delivery service will be provided through a partnership with Uber Eats. Starbucks plans to offer delivery service at 25% of company-operated stores. Delivery service was available at 2,000 stores across 30 cities in China by the end of 2018. The coffee company is launching its first European delivery test in London later this month. Quo Vadis analysts call the delivery roll out "the most interesting near-term development," but question whether it will be popular in the U.S. "While we believe that the Chinese consumer is already accustomed to and expecting delivery of consumer products including beverages like coffee, it is somewhat of an open question how much demand there exists in the U.S. for this service," analysts wrote in a note. "Today's press release suggests that the initial demand has been favorable." Quo Vadis thinks delivery will be a same-store sales driver. Starbucks is scheduled to announce first-quarter earnings on Thursday (http://www.marketwatch.com/story/starbucks-earnings-the-americas-are-making-a-comeback-but-china-is-an-uncertainty-2019-01-18). Starbucks shares have gained 5.4% over the past year while the S&P 500 index  has lost 5.7% in the period.

-Tonya Garcia; 415-439-6400; AskNewswires@dowjones.com

(END) Dow Jones Newswires

January 22, 2019 09:02 ET (14:02 GMT)

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