Coffee chain Starbucks Corp. (NASDAQ: SBUX) said that 25% of its milk-related beverage sales in the U.S. came from alternative dairy offerings in the quarter ending June 30.
What Happened: Starbucks made the disclosure while announcing its third-quarter results on Tuesday.
The company noted that the products in cold and alternative dairy are particularly attractive to Millennial as well as Gen Z customers and aligns with its focus on the “well-being of people and the planet.”
Starbucks reported third-quarter results that beat analysts’ estimates. The company said it saw strong demand for cold beverages in the U.S.
Why It Matters: Starbucks introduced a new line of oat milk-based drinks to its stores in the U.S. in March amid rising demand for dairy milk alternatives. The coffee chain reached a deal with Sweden-based Oatly Group AB (NASDAQ: OTLY) for supplying the oat milk for the drinks in March.
At the time, Starbucks said the addition of oat milk to its U.S. menu was part of its efforts to reduce its carbon footprint by 50 percent.
It was reported in April that Starbucks was facing a shortage of oat milk at some of its stores in the U.S.
Oat milk has recently become popular due to a shift in demand for plant-based milk alternatives. It is the fourth non-dairy milk alternative available for Starbucks customers in the U.S., alongside soy milk, coconut milk and almond milk.
Price Action: Starbucks edged down less than 0.1% in Tuesday’s regular trading session to $126.03 and further declined almost 0.3% in the after-hours session to $122.30.
Oatly Group shares closed 6.2% lower in Tuesday’s regular trading session at $17.50.
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