Starbucks Corporation has posted a decline in comparable store sales for the third quarter driven by reductions in both the US and China.
The company’s global comparable store sales for the 13 weeks ended June 30 were down 3 per cent year on year, extending a 4 per cent decline in the second quarter. This included a 5 per cent drop in comparable transactions, partially offset by a 2 per cent increase in average ticket.
North American and US comparable store sales fell 2 per cent, while international comparable store sales slid 7 per cent, with China plummeting 14 per cent.
The company achieved consolidated net revenues of $9.1 billion, representing a 1 per cent decrease on a reported basis and a 1 per cent increase on a constant currency basis.
GAAP operating margin contracted 60 basis points to 16.7 per cent, driven by increased promotional activity, investments in store partner wages and benefits, and deleverage.
CEO Laxman Narasimhan said the ongoing three-part action plan partially offset the headwinds brought about by the cautious consumer environment.
“Our disciplined approach enables us to preserve both balance sheet strength and flexibility, positioning us to successfully navigate through the current macroeconomic environment,” Ruggeri added.
Starbucks opened a net 526 new stores in Q3, ending the period with 39,477, of which 52 per cent were company-operated and 48 per cent were licensed.
The company did not provide guidance for the full fiscal year.
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