Starbucks on Tuesday reported weaker-than-expected quarterly earnings and revenue, fueled by a surprise decline in same-store sales. The coffee ch

Starbucks shares sink 12% as coffee chain slashes 2024 forecast amid same-store sales drag

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2024-05-01 00:00:10

Starbucks on Tuesday reported weaker-than-expected quarterly earnings and revenue, fueled by a surprise decline in same-store sales.

The coffee chain also slashed its forecast for its fiscal 2024 earnings and revenue, predicting that its cafes would keep underperforming for several quarters.

"In a highly challenged environment, this quarter's results do not reflect the power of our brand, our capabilities or the opportunities ahead," CEO Laxman Narasimhan said in a statement. "It did not meet our expectations, but we understand the specific challenges and opportunities immediately in front of us."

The company's same-store sales fell 4% as traffic to its cafes declined 6% in the quarter. Wall Street was anticipating same-store sales growth of 1%, according to StreetAccount estimates.

In the U.S., same-store sales decreased 3% as traffic sank 7%. This marks the second quarter that the company's home market has struggled. Last quarter, executives blamed sluggish sales on boycotts targeting the company due to "misperceptions" of its stance on Israel.