Friday, July 22, 2016
Starbucks shares slide after sales miss
Starbucks shares fell after the company reported lower-than-expected quarterly sales.
After the market close on Thursday, the coffee retailer announced that it earned $5.24 billion in fiscal third-quarter revenue, missing the forecast of $5.34 billion, according to Bloomberg.
Its global comparable store sales — at locations open for at least one year — rose 4%, lighter than the forecast of 5.4%.
But its adjusted earnings per share matched Wall Street's forecasts at $0.49 — a record.
Shares fell by as much as 5% in after-hours trading.
Earlier this year, Starbucks tweaked its rewards program so customers earned rewards based on the dollar amounts they spend instead of on visits. That didn't sit too well with some customers, as public sentiment toward the company fell, according to YouGov BrandIndex.
The company said the active membership of its rewards program increased 18% year-on-year and now has more than 12 million people in the US and Canada.
"As we enter Q4 and approach fiscal 2017, we have clear line of sight to returning our US business to historic levels of comp sales growth which had been at or above 5% for the 25 consecutive quarters prior to Q3," CEO Howard Schultz said in the earnings statement.
Starbucks announced earlier in July that it was giving all its US employees a raise of at least 5%, effective October 3.Google