Dunkin’ Donuts: Cold brew sales are hot

NEW YORK (AP) — Hot sales of the new cold-brew coffee at Dunkin' Donuts helped offset lower customer traffic, the company said Thursday, as quarterly revenue dipped and the company offered a downbeat outlook.

The cold brew drink costs more than the chain's regular iced coffee. Nigel Travis, CEO of parent company Dunkin' Brands, said the cold brew has been particularly popular with millennial customers.

"They like the taste profile of it," Travis said. "It's certainly in vogue."

The chain has been adding more specialty coffee offerings over the past several years, such as macchiatos and other espresso drinks, to better compete with rival Starbucks Corp. Travis said the cold brew — made by steeping coffee beans for 12 hours — was its most successful product launch in the last 16 years. Although less people came to Dunkin' Donuts shops in the last quarter, those that did spent more money. Buyers of iced drinks are more likely to purchase food or more coffee than those that buy hot drinks, Travis said. Dunkin' Donuts attributed a 2 percent rise in U.S. stores open at least a year to its iced coffee.

But parent company Dunkin' Brands Group Inc. also said it now expects total revenue for the company to grow less than previously expected, mainly due to its other chain, Baskin-Robbins. The company now expects full-year revenue growth of about 2 percent, down from a forecast of 3 percent to 5 percent.