Global Coffee Chain and its Same-Store Sales

Starbucks is one of the most famous global coffee chains, not only in the U.S., but around the world. However, as in the case of other companies, the global coffee chain is struggling to cope with some problems.

For example, its same-store sales fell 40% in the fiscal third quarter due to the coronavirus pandemic. Importantly, the fiscal third quarter ended on June 28.

However, the company appears optimistic about the future. Moreover, the global coffee chain raised the outlook for its adjusted earnings for the fiscal fourth quarter.

Interestingly, the loss per share was lower than expected, 46 cents, adjusted vs. the 59 cents expected. Furthermore, revenue exceeded expectations, as the revenue reached $4.22 billion.

Unfortunately, the global coffee chain reported a fiscal third-quarter net loss of $678.4 million or 58 cents per share. Notably, during the same period of time in 2019, net income was at $1.37 billion or $1.12 per share.

It is worth mentioning that costs related to the pandemic, like paid leave for baristas and added safety measures, affected its profits.

Global coffee chain and coronavirus pandemic

Notably, the coronavirus pandemic created serious problems for the companies and the global coffee chain is not an exception. Starbucks estimates that the pandemic resulted in $3.1 billion in lost revenue.

For instance, global same-store sales declined by 40% during the fiscal third quarter. Furthermore, transactions at locations open at least 13 months dropped by 51%. Interestingly, consumers spent more money, as the average check rose by 23%.

In the U.S. same-store sales fell by 40% in the quarter. The company temporarily closed most of its U.S. cafes between mid-March to mid-April, leaving only drive-thru and delivery.

Also, the number of active rewards members declined by 5% compared to the same period of time in 2019. Nevertheless, in China, same-store sales by fell only 19%. It is worth mentioning that China is Starbucks’ second-largest market.