NEW YORK (AP) – Starbucks reported disappointing quarterly sales growth Thursday for the holiday season and noted the challenging environment for restaurant retailers.
For the three months ended Jan. 1, the coffee chain said global sales rose 3 percent at established locations, including in the United States. Analysts had forecast growth of 3.8 percent globally and 4.2 percent domestically, according to FactSet.
The Seattle-based company said customer visits in U.S. stores fell 2 percent at established locations. It attributed the decline to a change in its loyalty program that stopped people from splitting orders to get more rewards. After factoring in the change, Starbucks says customer visits were flat.
The results come as Starbucks CEO Howard Schultz prepares to step down from that job in April. He will become executive chairman and focus on projects like the company’s new higher-end retail concept. Kevin Johnson, president and chief operating officer, will take over.
Analysts have questioned whether Starbucks will able to maintain its momentum without Schultz at the helm. The company has stressed that its popular loyalty program and offerings like mobile order-and-pay will help it keep growing.
For the quarter, Starbucks said sales rose 5 percent in its Asia unit, and declined 1 percent in the unit that includes Europe, the Middle East and Africa.
Starbucks earned $751.8 million, or 51 cents per share for its fiscal first quarter. Excluding one-time items, it earned 52 cents per share, in line with Wall Street expectations, according to FactSet. Total revenue was $5.73 billion, short of the $5.85 billion analysts expected.
The company’s shares were down 3 percent at $56.60 in after-hours trading.
Starbucks expects full-year earnings in the range of $2.12 to $2.14 per share.
Its shares have climbed 5.5 percent since the beginning of the year, while the Standard & Poor’s 500 index has increased nearly 3 percent. In the final minutes of trading on Thursday, shares hit $58.57, falling slightly in the last 12 months.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on SBUX at https://www.zacks.com/ap/SBUX
Copyright 2017 The Associated Press.