Starbucks glass art in store in Tokyo.
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Starbucks Tuesday reported quarterly revenue that missed analysts’ expectations as both US and international coffee faced weak demand.
The company’s shares rose more than 1% in extended trade.
Here’s what the company reported compared to what Wall Street expected, based on a survey of analysts by LSEG:
- Earnings per share: 93 cents adjusted vs 93 cents expected
- Revenue: $9.11 billion vs. $9.24 billion expected
The coffee giant reported fiscal third quarter net income attributable to the company of $1.05 billion, or 93 cents per share, down from $1.14 billion, or 99 cents per share, a year earlier.
Excluding items, Starbucks earned 93 cents per share.
net sales fall 1% to $9.11 billion. Same-store sales fell 3% in the quarter, driven by a 5% decline in transactions.
Traffic to US stores fell again this quarter, down 6%. Domestic same-store sales fell 2%, driven by an increase in average tickets. Last quarter, executives discussed a plan to revive the lagging U.S. business that included discounts and new drinks to bring back customers who had abandoned the chain.
Outside North America, same-store sales fell 7%. In China, Starbucks’ second-largest market, same-store sales fell 14% as average tickets and transactions shrank. Starbucks has faced tougher competition in China from local coffee shops that have undercut the coffee giant’s prices.
Starbucks opened 526 new stores in the fiscal quarter.
The company will discuss its fiscal 2024 outlook in an upcoming conference call. Last quarter, Starbucks lowered its forecast, estimating revenue growth in the low single-digit percentages and earnings per share in the mid- to low-single-digit percentage range.