JoAnn DeGrande - Investor Relations Howard S. Schultz - Chairman, President & Chief Executive Officer Kevin R. Johnson - President and Chief Operating Officer Scott Harlan Maw - Executive Vice President and Chief Financial Officer Adam B. Brotman - Chief Digital Officer, Executive Vice President Matthew Ryan - Global Chief Strategy Officer Clifford Burrows - Group President-Americas, US & Teavana Region John Winchester Culver - Group President-China & Asia Pacific

John William Ivankoe - JPMorgan Securities LLC Sara H. Senatore - Sanford C. Bernstein & Co. LLC Keith R. Siegner - UBS Securities LLC Sharon M. Zackfia - William Blair & Co. LLC David S. Palmer - RBC Capital Markets LLC John Glass - Morgan Stanley & Co. LLC David E. Tarantino - Robert W. Baird & Co., Inc. (Broker) Karen Holthouse - Goldman Sachs & Co. Andrew Charles - Cowen & Co. LLC Jeffrey Andrew Bernstein - Barclays Capital, Inc. Karen F. Short - Deutsche Bank Securities, Inc. Matthew James DiFrisco - Guggenheim Securities LLC Joseph Terrence Buckley - Bank of America Merrill Lynch Andrew Marc Barish - Jefferies LLC

Good afternoon. My name is Mike, and I'll be your conference operator today. At this time, I would like to welcome everyone to Starbucks Coffee Company's Fourth Quarter and Fiscal Year 2015 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. Ms. DeGrande, you may begin your conference.

Thank you, Mike. Good afternoon. This is JoAnn DeGrande, Vice President of Investor Relations for Starbucks Coffee Company. Thank you for joining us today to discuss our fourth quarter and fiscal 2015 year-end results, which will be led by Howard Schultz, Chairman and CEO; Kevin Johnson, President and COO; and Scott Maw, CFO. Joining us for Q&A are Cliff Burrows, Group President, U.S. Americas; John Culver, Group President, China Asia Pacific, Channel Development and Emerging Brands; Mike Conway, President, Global Channel Development; Matt Ryan, Global Chief Strategy Officer; and Adam Brotman, Chief Digital Officer. Given all we have to discuss today, both Q4 and 2015 year-end results, along with introducing our initial fiscal 2016 growth targets, we anticipate this call will run longer today than our typical quarterly earnings calls. This conference call will include forward-looking statements, which are subject to various risks and uncertainties that can cause our actual results to differ materially from these statements. Any such statements should be considered in conjunction with cautionary statements and our earnings release and risk factor discussions in our filings with the SEC including our last report on Form 10-K. Starbucks assumes no obligation to update any of these forward-looking statements or information. Please refer to our website at investor.starbucks.com to find the reconciliation of non-GAAP financial measures referenced in today's call with their corresponding GAAP measures. This conference call is being webcast, and an archive of the webcast will be available on our website at investor.starbucks.com later today. Let me now turn the call over to Howard. Howard S. Schultz - Chairman, President & Chief Executive Officer: Thank you, JoAnn, and good afternoon, everyone. Starbucks record Q4 financial results highlighted by stunning comp store sales increases of 8% globally, 9% in the U.S., and our second sequential quarter of a…

Thanks, Howard, and good afternoon, everyone. I'd like to take a few minutes to provide more color on the quarter and share my perspective on our business as we enter fiscal year 2016. Then I'll turn the call over to Scott, for details on our financial performance and outlook for fiscal year 2016 Howard highlighted a few key themes: Stellar operating and financial performance, our investments are paying off, and we have great confidence in our future. Since taking on the COO role in March, I've been personally focused on operationalizing the seven core strategies for growth we outlined at last December's Investor Day, allocating resources against those operating plans, and driving execution across the business. The investments we are making are aligned with those strategies, and they are working, giving us confidence going into fiscal year 2016 that we have line of sight to our next wave of initiatives and the business outcomes that will follow. Let's take a look at each business segment. Our fast-growing Americas segment continues to deliver industry-leading growth, posting 8% comp growth in Q4 with 9% comp growth in the U.S. Americas grew revenues 11% in Q4, fantastic operating performance for a business of its size, and it opened 612 net new stores over the past 12 months. Our beverage program, fueled by innovation such as our new Cold Brew and strong core beverage performance, drove six points of comp growth and delivered increased food attach. Sales of iced beverages, including Teavana Shaken Iced Teas, grew 20% year-on-year. And our limited-time offering line-up with the new and improved Pumpkin Spice Latte, Salted Caramel Latte, and Toasted Graham Latte performed well ahead of our initial expectations. Noteworthy is that in fiscal year 2015, Teavana branded, handcrafted tea beverages generated nearly $1 billion of sales through…

Thanks, Kevin and good afternoon, everyone. Starbucks performance in Q4 reflected a continuation of the pattern of accelerating momentum we have seen with each successive quarter of fiscal 2015. Revenue and profit growth each finished at the high end of our Q4 estimates and each of our four reporting segments achieved operating margin in excess of 15% for the first time in our history. Once again, demonstrating the strength of the Starbucks brand and continued excellent execution by our partners across the globe. Starbucks' strong Q4 results were particularly meaningful as they were achieved despite significant foreign exchange headwinds, and both the increase and acceleration of our partner and digital investments, investments that link directly to and in many ways are driving the comp and profitability growth we are experiencing. Kevin has addressed much of Starbucks' consolidated Q4 performance, so I will only comment that our GAAP operating margin in Q4 was 19.7% and non-GAAP operating margin was 20%, up nicely from Q3, but down 50 basis points from Q4 of last year, due to the impact of partner and digital investments and the change in ownership of Starbucks Japan, partially offset by sales and cost of goods sold leverage. Now on to the segments; revenue and operating income growth in the Americas continues to be very strong. In Q4, Americas' operating income increased 13% year-over-year to $840 million – $841 million on an 11% increase in revenues to $3.4 billion. And our operating margin expanded 40 basis points to 24.8%. Strong sales leverage resulting from a 9% increase in U.S. comps was the primary driver of the margin expansion, more than offsetting approximately 160 basis points of impact related to increased partner and digital investments in Q4. GAAP operating income in our CAP segment reached a record $130 million…

Your first question comes from John Ivankoe from JPMorgan.

Hi. Great. Thank you. The question might be a little bit obvious, but Howard, in the last conference call, and I think very rightly, you told us not to expect mid-single-digit comps and you told us certainly not to model more than mid-single-digit comps. So, in terms of kind of expressing that, you expect to have somewhat above mid-single-digit comps for fiscal 2016. I mean the question has to be asked, what specifically changed maybe relative to how you thought three months ago when you told us not to think about anything above mid-single-digit comps? And is it Mobile Order & Pay that's really getting the significant traction in the U.S. that's giving you the confidence to do so well on extremely difficult comparisons or is it other factors that you'd like to discuss? Howard S. Schultz - Chairman, President & Chief Executive Officer: Well, I certainly was – I was expecting that call, John, but not right out of the gate. So let's just kind of walk through this together. Throughout the calendar and fiscal year, we saw an acceleration of traffic and comp store sales. And I think if you go back a year ago, we were at 5% and 1%. And if you look at 9% and 4% in the U.S. and what we've done sequentially throughout the year and you couple that with the inherent momentum and attachment that we're seeing from mobile payment, Mobile Order & Pay, and specifically the integration, as Kevin talked about, and the attachment of loyalty, we have enough visibility in the business to be transparent with you that we believe that we're going to see some incrementality in our overall comp. And I think just like I've said in the years past, we want to be very straightforward and try…

And if I'm still on, Howard, it's certainly striking to hear your approach to labor in fiscal 2016 in this tightening economy, and maybe juxtapose that a little bit with Starbucks' experience maybe in the late 1990s and 2006, 2007 where you did participate in very tight labor markets. So, is it to some extent lesson learned from your perspective of just the importance of having the right people and compensating them and making sure that turnover is staying low, or how would you describe this current labor market relative to other tightening and expensive labor markets that Starbucks has seen in the past? Howard S. Schultz - Chairman, President & Chief Executive Officer: Well, I think the equity of the Starbucks brand throughout our public life has been defined by the culture and values and guiding principles. I said from day one that we are in the experience business, and our brand is defined by the people who wear the green apron. The entire DNA of the company goes back to equity in the form of stock options, comprehensive health insurance, 25 years ahead of the Affordable Care Act, and this year alone groundbreaking benefit of college achievement of providing all of our people with a four-year education. So, I think what we've seen is that other companies are reacting and playing catch-up to legislation, where we have always been ahead of it, and the tightening of the labor market is not something that we want to deal with or use as an excuse, just like we don't want to talk about weather. And so, we strongly believe that the investments we've made ahead of the curve on legislation in terms of labor and the benefits that we have provided for many, many years is an intrinsic part of the Starbucks experience, and the brand affinity, the loyalty, and all the things that we're doing are linked directly to the investments we've made in our partners. And I think, as Scott said, we can give you even more specifics that demonstrate that the return on investment of these benefits is dramatically affecting return on investment of new stores. You saw that in the $1.4 million first-year stores, the return on investment on comp store sales, and the incrementality. There's no one on the planet doing 4% traffic at our scale, especially when you consider that we have self-cannibalized, I don't know what the percentage is, probably 20%, 30% 40% of our store base this year alone, and no effect. We are driving incrementality in all day parts, and our people in many ways are responsible for it and we want to invest in them and with them. And I think the performance just shows the result.

Thank you (52:56) so much.

Your next question comes from Sara Senatore from Bernstein. Sara H. Senatore - Sanford C. Bernstein & Co. LLC: Great. Thank you very much. I wanted to ask a little bit more about digital and it's sort of a two-part question. One is, obviously Mobile Order & Pay extremely successful and I think we see that in the fact that you're rolling out so quickly elsewhere. I was wondering if you could talk a little bit about the relative impact on traffic versus ticket. Obviously, both numbers very impressive, but even a little bit more out of ticket that I might have expected. So that's part one. And part two is, maybe you could talk about further partnerships, so you talked about Spotify and Lyft and the New York Times. Could you share your plans for expansion there and when we might expect this to be maybe even a material contributor to operating results from a financial perspective that you actually call out separately? Thank you. Howard S. Schultz - Chairman, President & Chief Executive Officer: Yeah, thanks. Let's have Adam comment on Mobile Order & Pay first, and then we'll take the other two parts of your question.

Hi, Sara. This is Adam. On Mobile Order & Pay, a couple things to mention. First of all, before we get into specifics on ticket and transactions, it's worth reiterating that Mobile Order & Pay is part of a broader platform that includes card, loyalty, mobile payment, digital engagement, and now mobile ordering. And we're about to add delivery and music. So, no other consumer retailer has put together a platform like this, and Mobile Order & Pay is proving out what we thought, which is that when you get the flywheel effect of such a successful platform, you see the results that you see from Mobile Order & Pay. Now specifically to your question, we're seeing incremental transactions from Mobile Order & Pay, particularly in our busiest stores. We're pleased with the results across all the tiers of our stores. You know, ticket right now is holding steady and is doing quite well consistent with our other MSR ticket, and we haven't even added the feature of suggested selling and suggested pairing, which we're going to do in the first half of the year. So, we expect to see that increase on top of the incremental transactions that we're seeing.

Yes, and Sara, this is Kevin. I'll just add to Adam's comments about what's driving our comps. I think there's three key things. Number one, Howard mentioned is the investments we've made in our partners and the fact that we've reduced attrition is allowing our partners in store to better connect with our customers, and we know that that yields better outcomes in terms of comp growth. And so that's number one. Number two is our investment in food and beverage innovation. In fact, if you look at the comps, three points of our comp growth came from food. Our breakfast sandwich business has doubled in the past three years. Lunch is accelerating. We now have evenings program deployed in 100 stores, so it's early days on evenings, but we've seen growth in every day part as a result. On the beverage side, that accounted for 6% – six points of comp growth. And so innovation certainly around things like Cold Brew contributed to it, and very good results with our iced beverages including the Teavana Shaken Iced Teas, which grew 20% year-on-year. So in addition to the investment in partners, it's the investment in food and beverage innovation, and then finally is the investment in digital and loyalty. So in fact, we know that MSR customers on average spend three times as much as non-MSR customers, and we've grown the number of active MSR customers by 28% year-on-year. So the investments we're making in our partners, food and beverage innovation and digital and loyalty are key drivers. Howard S. Schultz - Chairman, President & Chief Executive Officer: There was one question about partnerships, future partners. Matt, do you want to take that?

Sure. It's Matt Ryan. We have only just begun with our partnership business regarding loyalty. And while we've announced three specific deals, there are many more to come. We are in the process of building capability to offer Stars everywhere. That is the opportunity for customers to essentially earn Stars at a lot of different places and take them back to Starbucks. That is going to be a lever in our business in the future and that has not yet impacted our business but will. In addition, as we negotiate those deals, we are going to have additional benefits to both our customers and our partners, which will accrue back to us in the form of loyalty and deepened engagement. So we're very, very bullish on that. We don't have specific announcements today, but stay tuned.

Your next question comes from Keith Siegner from UBS.

Thank you. Howard, in the past couple of years, you have talked about the seismic shift in the retail landscape and how you were going to strategize against that. If you think about the success of the Mobile Order & Pay, this whole platform that it's integrated into, delivery and inevitability, next-gen features you said are already in sight. When you think about that real estate, that physical asset base that you've talked about and its role in servicing that relationship; does this change or could this change? Can you exploit some of that relationship and come up with a new or different way to even further deepen that relationship with consumers? How do you think about that? Thanks. Howard S. Schultz - Chairman, President & Chief Executive Officer: You know, I think – as you all know, I think two years ago or so, we shared with you that we had begun to witness and get quite concerned about a downturn in pedestrian traffic on Main Street and certainly a downturn in traffic in malls. And I think if you look at the retailers that are succeeding, I'm not talking about people in our core business but all retailers anywhere in the world, it has to be an experiential, emotional experience where the retail experience is really exceeding the expectation of the customer. And so we went back to work on that and I think we also believe very strongly that we had to seamlessly integrate the Starbucks experience with all things mobile. And as I said in my prepared remarks, we are living in a mobile-first global economy and we're witnessing that kind of change. With regard to the physical shape, size, and what we do in our stores, I think we do believe, and I can't give…

Your next question comes from Sharon Zackfia from William Blair. Sharon M. Zackfia - William Blair & Co. LLC: Hi. Good afternoon. I wanted to touch on the labor investment that you've made in the U.S. I think you talked about making more of an investment globally as well. Can you dimensionalize kind of the order of magnitude of the investments, both in the U.S. that you've already done and maybe ongoing investment into 2016 both in the U.S. and overseas?

Yeah, thanks, Sharon. It's Scott. So the total amount, as I mentioned, is between $250 million and $275 million. The vast majority of that, again, will be in the U.S. I think the important part is there is some amount that will happen out in the regions, much smaller dollars, but that includes not only partner investments which is wage and benefit, but it includes an acceleration of some things we want to do digitally around mobile, around loyalty, and around platforms in general. So I think the way to think about it is vast majority in the U.S., a bit in the other regions. And as we go through the year, if those numbers become significant, we'll give you an idea of how they landed by segment.

Your next question comes from David Palmer from RBC Capital Markets.

Hi. Thanks. What customer and partner feedback are you getting on Mobile Order & Pay so far, and in what ways do you think you can improve the app or adjust operations to make the experience even better? And just separately, bigger picture, I think you said 21% of orders were mobile payment to some degree. It might be striking to you internally as an opportunity that four out of five orders are not using the benefits of mobile pay or mobile order. Are you thinking about ways that you can further drive penetration to get them into this digital ecosystem that you have? Thanks. Clifford Burrows - Group President-Americas, US & Teavana Region: Thanks, David. It's Cliff here. It has been incredible to see the adoption by customers across the country, and with each wave that we've launched, the ramp rate has been quicker for adoption. I think what is most exciting is our highest volume stores are the ones that are seeing the biggest share come from mobile orders, and what is happening with that is it increases capacity in the store itself. So we're seeing two wins on this. We're seeing the adoption of mobile orders, and we're seeing increased capacity in the core stores. So every part of the country is now live, and we are seeing activity from mobile orders in every part of the country. I could speak briefly to Canada where that adoption focused in Toronto has mirrored what we've seen in the U.S., and it just bodes really well for the future. Adam, do you want to talk about the increased offer?

Yeah, thanks, Cliff. This is Adam. David, just to build on what Cliff said in terms of some of our busiest stores particularly in either hospitals or downtown locations, let me give you some examples of that. Yesterday, World Financial Center in New York City did 150 mobile orders for over 10% of their overall transactions. Duke Energy Center in Charlotte, North Carolina has been doing incredible with Mobile Order & Pay. They did over 234 mobile orders yesterday for 20% of their transaction. Cleveland Clinic in a busy hospital where the convenience of when you're on break and you don't have a lot of time and you want to just get your mobile order and get out, incremental occasions being driven there 269 mobile orders for 11% of their transactions. So these are in on our busiest tier. It gives you an example of how pleased our customers and stores are with Mobile Order & Pay. Customers are responding incredibly well. We're seeing conversion rates from trial like we've never seen before. We are seeing some of the best customer satisfaction scores for Mobile Order & Pay, particularly around customer connection, which is a great indicator of future visits. So we're really happy with what's going on there. And in terms of what are we going to do to continue to improve it and how are we going to get even better adoption, that's absolutely in our plan. First of all, we're constantly improving the estimated pick-up time algorithm. Same with store inventory, we've enhanced our ability to display accurate store level menu and inventory availability and we're chockfull of great new features that are coming for Mobile Order & Pay including the ability, like I mentioned earlier, for suggested selling which should drive not only customer satisfaction but…

Your next question comes from John Glass from Morgan Stanley. John Glass - Morgan Stanley & Co. LLC: Thanks very much. I thought I'd maybe go in slightly different direction. I wanted to just ask about CAP and the comps being 6%. They had been stronger in prior quarters, traffic had been stronger. So I'm just wondering what that deceleration was, where it came from? You talked about China being strong. So I wasn't sure if it was maybe ex-China. Maybe you can put a little more color around what is going on in China since that seems to be a controversial area now. John Winchester Culver - Group President-China & Asia Pacific: Yeah. John, let me – this is John – let me just talk a little bit about China and what we're seeing in China. And first, let me just be very clear that our business in China and across CAP remains very, very strong. You look at the momentum that we've been able to build. We've seen no systemic slowdown in our business in China. As we discussed on the call, our performance in terms of comp in China accelerated above the total region. And when you look at the comp breakdown, not only in China but then also across the region, this is all being driven by transactions which is phenomenal. It means that we're attracting more new customers into our stores every day as well as, at the same time, continuing to build frequency with our existing customers. In addition, what we saw during the quarter was that comps actually accelerated month to month. And in China, we see that comps are continuing to accelerate into the month of October, which is great news for us. Just let me touch on China because I know there's a lot of questions out there right now. Today, we operate 1,800 stores across 95 cities, and when you think back to two years ago, we had a 1,500 store target in China by the end of 2015. We are significantly ahead of that 1,500 store target with over 1,800 stores. In the quarter, we opened 135 new stores in China. That's 1.5 stores per day, which is actually ahead of the 1.2 stores that we average for the entire fiscal year of 2015. And when you look at the new stores that we're opening in China, we have the best age class performance in our new stores since 2012. And when you break down the total growth across CAP and really across China, 75% of our revenue growth is being driven by new stores, 25% is being driven by comp, and what we continue to do is focus on investing ahead of the curve as it relates to our people, the digital landscape, IT, store development, supply chain, and continuing to elevate our coffee position in the marketplace. So, again, we're just very optimistic about the opportunity that CAP presents and more specifically what China presents.

Your next question comes from David Tarantino from Robert W. Baird. David E. Tarantino - Robert W. Baird & Co., Inc. (Broker): Hi. Good afternoon and congratulations to all of you for delivering great results. My question, Scott, is two-fold. First, on the investments that you're making, or the incremental investments you're making into business, are those structural in nature, meaning they'll continue beyond 2016, or are there any one-time in nature? And then I guess the second part of my question is just the flow-through to the margins that you're anticipating in 2016 on the comps you're expecting, looks a little low on the surface. So is there anything going on outside of some of the factors you mentioned that would prevent the flow-through down to the bottom line in 2016?

Thanks, David. On the first part of your question, I think what we've done in 2015 and heading into 2016 is actually accelerate the investments as we've moved through time. So we had a number as we started the year in 2015, and each quarter we actually leaned in a little bit more. And we're doing that again in 2016. And I think there may be some of that that continues as we head into 2017, but obviously as we've changed our plans as we move through 2015, we'll update you as we get into 2017. So I do think we're in an accelerated investment mode now. At some point, that will tail off. But I think the best way for you to think about it is as we move through time, we'll let you know. When we see opportunities to accelerate given what's happening on the top line, we will lean in. We will spend more. We won't hesitate to do what the right thing is. And so, I think the best thing for you to do is just sort of track with us as we go through time. I feel good about what we have for 2016. As we get through the year, we'll talk about 2017. On flow-through, I would say part of the flow-through that you're mentioning is driven by exactly what I'm talking about. So we are definitely investing ahead of the curve. So there's a little bit of advanced and accelerated investment that's having some impact on margin. But I just want to go back to the comments I made on the call that are really important. A lot of what you're seeing for the full year on margin and EPS growth guidance is really a result of what's happening in that first quarter, driven by significant FX impact which impacts top line and bottom line and margin. And driven by the fact that we didn't really start our partner investments until January of last year. So that math is impacting the whole year. As you get through to the rest of the year, you kind of come back up into the middle of our range on a non-GAAP basis.

Your next question comes from Karen Holthouse from Goldman Sachs. Karen Holthouse - Goldman Sachs & Co.: Hi. Congratulations on the quarter. I want to ask actually a question about food, which is 3% of comp growth instead of 2% of comp growth on a larger base, lunch is accelerating. Certainly some data points there to feel good about. As it's become a bigger part of the business, kind of outside of the breakfast day part, I'm curious what you're learning in terms of merchandising, products that people are using, grab and go versus things in the case, and just what you've learned so far that can help you continue to grow and build momentum in that part of the day? Clifford Burrows - Group President-Americas, US & Teavana Region: Thanks, Karen. It's Cliff. We're really pleased with what we're seeing with food and food across the day parts. The strength of breakfast sandwiches, as Kevin mentioned earlier, we've seen that business double over the last three years. And that is quite significant for us. We're also now into testing lunch, and we're seeing both great reaction from the customers around the offering, Bistro Boxes, paninis, and the enhancement of our sandwich range. And evenings is – it's 100 stores now, and we're going to open several hundred more during the year with the evenings program, and that is giving us a day part where not only is the wine beer and our standard beverages but there is also this opportunity for sharing plates. So that is – so the day parts we're excited about, we're able to offer to customers. At the same time, we are increasing the introduction of what we're calling, Wall of Chill, which is our grab and go food presentation, which in high volume stores certainly in the urban locations not only do people buy products for breakfast, but they also often buy something to take with them like the Bistro Box. So portability is important. Food is growing both in our store and through the drive-thru lanes. And with what Adam was talking about on Mobile Order & Pay, our ability to offer people at a store level the food range that that store has and, over time, a much more dynamic suggestive sell plus responding to the in-stock position, all of those things bode really well. We've seen food grow through that 3% comp to 20% of the mix in U.S. stores, and we see that increasing over time to the mid-20%s, but obviously beverage will still drive it. And we'll just keep investing, keep learning, and keep growing it.

Your next question comes from Andrew Charles from Cowen & Co. Andrew Charles - Cowen & Co. LLC: Great. Thank you. Adam, with Mobile Order & Pay and delivery coming soon and the marketing opportunities these have, do you view straight-up mobile payment as something ultimately become obsolete or it still have its place given the robust customer data you receive from it as well as the convenience?

I think, Andrew – this is Adam. No, mobile payment is not going to become obsolete. Although mobile ordering is a form of mobile payment and we are going to see a significant number of transactions morph over. But it's really the spectrum of offering customers what they want. If they want the convenience of mobile payment, mobile loyalty engagement, we're going to continue to offer that and innovate on that. And as mobile ordering becomes more and more powerful and more and more prevalent, you're going to see some of that shift over. I will tell you that we saw record mobile payment last week, and as Kevin and Howard mentioned, over 21% of our transactions are still mobile payment, and it's going strong in terms of both mobile payment and now mobile ordering

Your next question comes from Jeff Bernstein from Barclays.

Great. Thank you very much. Just had follow up questions on, I guess, China, Asia-Pacific region. Maybe just a two-part question. One, in terms of the unit potential, I know you're talking about accelerating that. I'm just wondering it looks like this year you're talking about 900 units, up slightly from I think you guided last year to 850 units. So I'm wondering what's the gating faster that maybe faster growth, I guess it's primarily in China, whether it's people or real estate? It doesn't seem like it's demand. And I'm sensitive to asking this because I know about prior concerns of growing too fast. But the first part of the question was just on what's the gating factor. And the other piece was just broadly around China just as you build that business and one day it will be the biggest business outside of the U.S. Can you just talk about the success you're seeing and shifting customers whether it's pushing them from p.m. to a.m. or shifting them from tea to coffee, just how you're converting those customers into more of the traditional Starbucks customer? Thanks. John Winchester Culver - Group President-China & Asia Pacific: Hi, Jeff. This is John. Thanks for the question. First, in terms of the growth rate around stores, we'll open approximately 900 stores across China next year. And we're well on our way to delivering the 3,400 or 3,500 store target by 2019. We continue to be very disciplined in how we're looking at real estate, how we're building the stores, and, more importantly, how we're creating that experience for our customers and really taking the long-term view on that. When you look at the success of the portfolio, particularly this past year, but more importantly as well in year's prior, the portfolio…

Your next question comes from Karen Short from Deutsche Bank.

Hi. Thanks for taking my question. I just want to ask a couple of questions about guidance. I guess, though, the first is within your comp guidance, can you maybe just kind of go into more detail on the different components, food, tea, innovation, Mobile Order & Pay? And then the second question I had is just, I guess your fiscal 2016 guidance for Americas calls for moderate margin expansion, which is consistent with your language on fiscal 2015 margin guidance, and yet obviously, margins were up 80 basis points. So I guess any color on what your definition is of moderate because you definitely seem more confident on your ability to drive comp, so maybe wondering if you're being conservative. Thanks.

Thanks for the question. On the first part, I think comp growth next year in the U.S. will look a lot like it looked this year. So in other words, strong growth from food probably in that two-point, maybe three-point range. It's important to point out this is the first time we've ever had three points in food, so the momentum is continuing. I would expect to see limited time offerings in innovation, as Kevin talked about, with things like Cold Brew. There's lots of things in the pipeline that will continue to drive a point or two point of comp there. And then, importantly, the core of what's driving our comp today is all of our regular platform, so espresso, iced beverages, just significant growth in those things that we've been doing all along and we just continue to do them better. So I think the comp breakdown, think of it as very similar to what we did both in the quarter and the year. And then, yeah, I expect Americas comp expansion to be in the range of what you saw this year. So we said moderate. That was 80 basis points, and I think that, that's in the range of what we'll see as we look forward for 2016.

Your next question comes from Matt DiFrisco from Guggenheim Securities.

Thank you. I also have a question on a little bit of the guidance there with the margin outlook for the U.S. It also seems a little conservative if I look at where coffee costs have gone. I wonder if you can just give us an update of what you've locked in. I know the last time you talked, I think you said it was 80% locked in. I'm just curious if the majority of what we're seeing in the commodity market coming down now, how that directionally relates to your coffee if that's more so a multiple-year progress of you being able to realize that benefit. And in addition, also I just wanted to make sure I understood the partner investments that you've made. How much has that helped you to maybe have a less of a hit from the structural wage inflation coming down the pipe when the calendar turns to January? How much are you already fronting?

Thanks, Matt. It's Scott. As it relates to coffee costs, the first thing that I'll just remind everyone is coffee in our retail business continues to be a decreasing part of overall COGS. So just keep that in mind as we grow, the movement in coffee prices really impacts channel development more than it does the retail businesses. With that said, we expect coffee costs to be a little bit favorable as we look forward into 2016. And I think this was inherent in your question, Matt. If you go back a couple of years, you'll recall that in 2014, coffee prices spiked significantly. They spent a good portion of the year above $1.90. They went above $2. Heading into that spike, we were quite long in our coffee inventory, and so we didn't buy much coffee at those prices. And so when coffee came down for 2015, we started buying. And so, if you were to take a look at the spot rate impacting 2015, we were much lower than that spot rate because of our coffee buying practices. So as you roll over into 2016, the delta in the spot rate doesn't impact us as much because we didn't pay as much as the market did in 2014. So that's what's happening is we're smoothing out those costs, aborting the spikes that we had in 2014 and our 2015 P&L, and that's rolling into some favorability in 2016 and I think some favorability as we head into 2017, depending on what the market does. So I think being patient there definitely paid off for us. So, do you want to – Cliff, do you want to try (85:17). Clifford Burrows - Group President-Americas, US & Teavana Region: Yeah, I'll respond, if I may, Matt, about the investments and wages. So anything that we know about or has been mandated either locally or by states across the country, we've anticipated that in our plans. We're, obviously, annualizing the investments that we want to make and have built that into our plans for the year ahead. And these are investments such as food benefit for our partners, our college achievement plan, and what we're going to do with our partners there and the increased enrollment, 4,000 partners today and we see that number increasing significantly in the coming years. We've anticipated that and we've planned for it. And, obviously, there are some other investments we've made to support our business plan for this year around comp growth, around new stores, around the increased complexity of our business. And we feel very confident with those investments. Obviously anything that comes along during the year we'll respond to and we'll deal with it accordingly and update you as the year goes on.

Your next question comes from Joe Buckley from Bank of America.

Thank you. Can I ask a clarifying question? I think, Howard, in your remarks you said mobile payments were 21% of the mix, and, Kevin, I think you used the same percentage for the month of October. So I guess I just want to clarify what period that 21% applied to and maybe both. And then if you would talk a little bit about what the Mobile Order & Pay component of mobile pay is and just how do you see that building as the rollout – well, the rollout is over now, but how do you see that building over time?

Yeah, Joe, this is Kevin. The 21% of tender being paid for with the mobile payments was a statistic for the month of October. That's the latest data point that we have. So it's 21% for October. In terms of data on percent of transactions or percent of tender that's Mobile Order & Pay, since we just finished the rollout in the U.S. late in the quarter, we don't have a full run-rate of quarter, so we're still watching that advance. I think Adam gave you some color on some of the locations that are seeing high usage of that. But each wave of deployment we have made has been adopted faster than the prior wave. And so I think that there will always be some customers that will go into the store that want the in-store experience that will order at the point of sale and pay mobile. And then other customers that will want to do Mobile Order & Pay for convenience, and they'll pay. So you think about Mobile Order & Pay will always be a subset of the total mobile payment tender that we take. And as soon as we have some track record of full quarters of data, we'll be in a better position to share. Adam, do you want to add anything to that?

Yeah, just building on what you said, Kevin. This is Adam. Howard mentioned that we're seeing a five million mobile order per month run-rate already. And while we're not breaking out specific percentages, there is a range of mobile order numbers across a number of store tiers particularly in our busiest tiers and we are seeing significantly more incremental transactions, incrementality in our busiest stores. We are seeing, internationally, our latest wave that went out for Canada and U.K. saw even a faster adoption than the New York wave, which was faster than the previous wave. So we're getting better at getting faster customer adoption and it bodes well for Mobile Order & Pay globally. Howard S. Schultz - Chairman, President & Chief Executive Officer: Yeah, Joe, I'll just mention one final point. There are many scenarios where the customer wants the full Starbucks Experience. And then there are other scenarios where that same consumer may want the convenience of Mobile Order & Pay. So we're going to see the balance of consumers that are going to use both. And we think that's a very good thing. We've added this capability that provides significant convenience to the consumer, but we've done it in a way that does not take away from or prevent the full Starbucks Experience on those occasions that that experience is desirable to them. And so, our ability to sort of observe and see how consumers respond and react to this I think is very important. And thus far, I think we're seeing great results, great reception, and we're very confident that we're on the right path.

We have time for one last question. The last question comes from Andy Barish with Jefferies. You may ask our question.

Hi, guys. Just a boring numbers question. The G&A was pretty heavy in the 4Q and actually de-levered for the full year. So I'm assuming some of that was incentive comp given the impressive results. But is that where a lot of the technology investment is also falling, Scott, and maybe what is your outlook for the ability to leverage G&A in fiscal 2016?

Yeah. Thanks, Andy. It definitely was driven by both the technology investment as well as the delevering year-over-year is partially driven by the Japan acquisition just given how the accounting works there. And then some catch-up definitely in the fourth quarter around incentive comp. If you sort of normalize for that, our goal is to grow G&A at half the rate of revenue, and we basically achieved that in 2015. You've just got to strip out some of the accounting from the Japan acquisition and some of the other items that are in there from an investment standpoint. Going forward, we are still targeting to leverage G&A. I will tell you it will be less than that half a rate of revenue growth as we look in 2016. And that's because the technology investments will hit G&A and put a little bit of pressure on that. But we still expect a bit of leverage as we look forward.

Thanks, Scott. Thank you for joining us today. This concludes Starbucks' Q4 and fiscal year-end 2015 earnings call. Good night.

This concludes Starbucks Coffee Company's fourth quarter and fiscal year 2015 earnings conference call. You may now disconnect.