Starbucks shares jumped in after-hours trading after the company reported third-quarter earnings and revenue that beat expectations and raised its fill-year outlook, suggesting its turnaround is under way.

The stock rose 5% after hours, to $109.44, after closing the regular session up 1% to $104.14.

For the fiscal quarter ended June 28, Starbucks reported adjusted earnings of 85 cents a share, well above the 66 cents analysts expected. Revenue fell 1.4% from a year earlier to $9.32 billion -- partially due to the conversion of Starbucks' China operations into a licensed joint venture -- but still topped the roughly $9.17 billion consensus estimate.

Starbucks completed its China joint venture with Boyu Capital in April. Boyu owns 60% of the retail operation, while Starbucks retains 40% and licenses its brand -- a more asset-light model that lowers reported revenue but could improve margins and reduce operating risk.

In the third fiscal quarter, global comparable-store sales rose 7.9%, driven by a 4.2% increase in transactions and 3.5% gain in average ticket. U.S. comparable sales advanced 7.9%, including a 4.2% transaction gain, suggesting the improvement wasn't simply the result of higher prices.

Starbucks raised its fiscal 2026 adjusted earnings forecast to between $2.55 and $2.65 a share, from $2.25 to $2.45 previously. It now expects global comparable-sales growth to approach 6% for the full fiscal 2026, up from its earlier forecast of about 5% or more. Management projected fourth-quarter U.S. comparable growth of at least 6.5%.

The results strengthens CEO Brian Niccol's argument that the company's "Back to Starbucks" strategy -- including menu simplification, increased staffing, reduced wait times, and a revamped Rewards program -- is bringing more customers back.

"This was the quarter our momentum became truly measurable," said Niccol in a video message to investors, "Customers feel the difference. They're visiting more often. They're engaging with our brand in new ways. They're finding more value in the Starbucks experience. And it's showing up in our results."