Starbucks Corp. Misses Analysts’ Estimates

Shares of Starbucks tumbled this week after the company posted quarterly cafe sales growth that missed analysts’ estimates.
Global sales at company-owned cafes open at least 13 months rose 4 percent in the fiscal third quarter ended June 26 from the year-ago period.

According to Consensus Metrix, this number was well below the 5.6 percent that analysts had anticipated.

Sales at established cafes in the U.S.-dominated Americas region grew 4 percent. This also was well short of analysts’ expectations of a 6.1 percent gain.

Starbucks Chief Operating Officer Kevin Johnson commented in a telephone interview that consumer uncertainty was rising due to geopolitical events including Brexit, security concerns and the U.S. presidential election.

In its earnings report, the company also revealed that net income rose 20 percent to $754.1 million, or 51 cents per share. Revenue was up 7 percent to $5.24 billion.

Starbucks recently upped the prices on some of its drinks and said it would raise base pay at least 5% for about 150,000 company baristas in the U.S. and managers at company operated stores. The move will start October 3rd.

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