Starbucks reports drop in sales for 2nd straight quarter
Date
7/31/2024 9:49:46 AM
(MENAFN) US-based coffeehouse chain Starbucks reported a decrease in sales for the second consecutive quarter, as detailed in its financial results statement released on Tuesday. The company's global comparable store sales dropped by 3 percent, primarily due to a 5 percent decline in comparable transactions. This decline was somewhat mitigated by a 2 percent increase in the average ticket value, highlighting a trend where fewer customers are making purchases, but those who do are spending slightly more.
Regionally, North American store sales fell by 2 percent, mirroring the overall trend in the US where store sales also declined by 2 percent. The situation was more pronounced in China, with a significant 14 percent drop in store sales, while international store sales overall decreased by 7 percent. These figures reflect the broader challenges Starbucks is facing in maintaining customer foot traffic and sales across different markets.
Despite the sales downturn, Starbucks continued to expand its footprint, opening 526 net new stores during the third quarter of the 2024 fiscal year, covering the April-June period. This brought the total number of stores to 39,477 globally. The statement noted that at the end of Q3, the US and China together accounted for 61 percent of Starbucks' global store portfolio, with 16,730 stores in the US and 7,306 in China, underscoring the importance of these two key markets for the company.
Financially, the company saw only a modest 1 percent revenue increase in North America. However, international revenues declined by nearly 7 percent, falling to USD1.84 billion from USD1.97 billion compared to the same period last year. This revenue decline highlights the significant impact of reduced sales in international markets on Starbucks' overall financial performance, amidst ongoing efforts to balance growth with the challenges posed by varying regional market conditions.
MENAFN31072024000045015839ID1108502806
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.