Global Comparable Store Sales: Declined 4% year-over-year
North America Comp Growth: Negative 3%
China Comp Growth: Negative 11%
Operating Margins: Contracted by 140 basis points to 12.8%
Earnings Per Share: Declined by 7% to $0.68
Future Guidance
Execution Strategy: Accelerating work on underlying execution engines for business improvements
Technology Investment: $600 million investment over the next 3 years to digitize stores and improve customer targeting
Global Expansion: On track to operate 55,000 stores by 2030, with specific growth targets for India and new market entries like Honduras and Ecuador
Efficiency Goals: Increased target for supply chain and operational efficiencies from $3 billion to an unspecified higher figure over three years
Trends, Market Conditions, Sentiment
Consumer Caution: Observed impact of a more cautious consumer across key markets, affecting traffic and sales, particularly among more occasional customers.
Economic Volatility: Challenges include economic volatility in the Middle East and fierce competition in China.
Operational Challenges: Notable issues with meeting demand during peak times in the U.S. due to operational inefficiencies.
Product Innovation: Focus on launching more relevant and exciting new products while maintaining core coffee-forward offerings.
Digital Expansion: Significant digital initiatives underway, including making the Starbucks app available to all customers and installing digital menu boards in all company stores in the U.S. and China.
Market Confidence: Despite near-term challenges, there’s a strong sentiment about the brand’s resilience and long-term growth potential.
Notable Quotes
”Our performance this quarter was disappointing and did not meet our expectations."
"We confront these challenges from a position of enduring strength."
"Our triple shop with 2 pumps reinvention strategy continues to deliver, and our possibilities as a company remain limitless."
"We’re accelerating our work on the underlying execution engines that power our business to realize these opportunities."
"We’re investing further to grow our SR members and their loyalty to drive greater engagement and lifetime value."
"We are confident in our accelerated plans to strengthen the execution engines that power how we serve our customers."
"We will weather through this dynamic and transitory period as the industry shakeout continues.”
