Starbucks Brews Comeback Plan, Misses Quarterly Sales Estimates
Key Metrics:
* Revenue: $9.4 billion (flat YoY)
* Earnings Per Share: $0.69 (-23% YoY)
* Same-store Sales: -4%
* Foot Traffic: -6%
* Average Ticket Size: +3%
CEO's Outlook:
"The first quarter results met our expectations, showing progress, but much work remains." - CEO Brian Niccol
Key Initiatives:
* Focus on core coffee products
* Improved pricing
* Faster service
* Reduced menu offerings (30% by year-end)
* Paused price increases
* Increased marketing spend (offsetting promotion savings)
Challenges:
* Declining same-store sales and foot traffic
* Earnings decline due to "heightened investments" in turnaround plan
* Ongoing negative same-store sales trends expected by analysts
Stock Performance:
* Gained 5% in the past year (lagging S&P 500's 24%)
* Risen 32% in the past six months since Niccol's appointment
International Outlook:
* China: Struggles amid economic stagnation and fierce competition
* Niccol's visit highlights market dynamics and upcoming opportunities
Changes:
* Coffeehouse Code of Conduct implemented
* Corporate layoffs planned for efficiency
* Management shakeup with executive departures and team reorganizations