Starbucks Hits New Low After This News

Starbucks revealed this week that it will be shuttering over 150 poorly performing stores in the next year.

This is roughly three times more than the coffee giant usually closes a year.

This news along with the company lowering its forecast for same-store sales for the quarter beginning next month, sent shares of the stock lower on Tuesday in after-hours trading.

CEO Kevin Johnson remarked, “Our recent performance does not reflect the potential of our exceptional brand and is not acceptable. We must move faster to address the more rapidly changing preferences and needs of our customers.

He continued, “Over the past year we have taken several actions to streamline the company, positioning us to increase our innovation agility as an organization and enhance focus on our core value drivers which serve as the foundation to re-accelerate growth and create long-term shareholder value.”

“In this last quarter, we had an unplanned initiative related to the incident in Philadelphia that culminated in closing stores,” Johnson commented on a call from the Oppenheimer Consumer Conference on Tuesday.

It was this past April that in Philadelphia, two black men, who had not ordered anything, had been arrested for doing nothing but sitting in a Starbucks store.

“It is not an excuse,” for the 1% growth rate the company is now expecting, he said.

Disclaimer: We have no position in Starbucks Corporation (NASDAQ: SBUX) and have not been compensated for this article.