Cold coffee is a hot business for Starbucks (SBUX). In the company's third quarter conference call, Starbucks CEO Laxman Narasimhan said that 75% of its U.S. beverage sales were from the sale of cold drinks. In addition, Narasimhan says that cold foam is now "the fastest-growing customization at Starbucks." Overall, Narasimhan says customizations, such as cold foam, "contribute to over $1 billion in revenue annually." So who is buying all of those drinks? Starbucks CFO Rachel Ruggeri tells Yahoo Finance Live "it's definitely skewed more towards a younger consumer. We have a large consumer base of millennials and Gen Z and their taste and preferences tend to be more cold." "It is definitely an increasing trend and we don't see it going away," Ruggeri adds. Ruggieri says that, overall, beverage sales grew by 10% in the quarter. "We did see growth of about 2% weighted on that 10% from a hot perspective, but we also saw cold grow about 8%," Ruggeri said. Recently, Starbucks has started changing out ice cubes for ice nuggets. Ruggeri says part of the reason the company is making the switch is to nugget ice is because of the cold drink demand. Ruggeri says the nugget ice blends faster and that eventually it will be piped into the stores so employees don't have to carry buckets of ice. Click here to see Julie Hyman, Diane King Hall, and Brooke DiPalma's full interview with Starbucks CFO Rachel Ruggeri.

Read more --->