The answer is on page 52 of their annual report. https://s22.q4cdn.com/869488222/files/doc_financials/annual/2017/01/FY17-Starbucks-Form-10-K.pdf …
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Add another ~20% if you want to include "these cards still have balances, but we're pretty sure they've been lost and the owners will never make use of said balances" amounts.
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Breakage revenue was 5X my estimate. (And, I expect, materially higher than 20% of the booked liability if you summed it over time.)
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Includes all of the value of any Starbucks cards with a stored value, including masses still sitting around unpurchased on the shelves of other retailers. They're correct to do so, but I wonder what the percentage of the potential liability is comprised of cards no-one owns yet.
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That feels very unlikely to be as a matter of GAAP; you incur the liability when the amount is known and performance is actually required, which is as of purchase/activation.
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Wow! That’s unreal...
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Fermi estimation wins again.
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Starbucks is basically _the_ example of what people hype about prepaid. Holding onto a billion of other people's dollars is great. And turning 4 $5 transactions into one $20 transaction is also pretty nice.
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Enough that if all the gift cards were redeemed within a 24 hour period they'd have to make 3343 coffees/second (at $4.50/drink)
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I guessed correctly!
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