Starbucks Corp missed Wall Street expectation for quarterly comparable sales on Tuesday, hurt by weakness at its business abroad where the COVID-19 pandemic has forced governments to restrict travel and shut cafes.
Shares of the Seattle-based coffee chain fell about 3% in extended trading.
The coffee chain, like other restaurant chains, has struggled for over a year as consumers worked from home and made their coffee and breakfast at home. Recent lockdowns in parts of Asia and Europe kept more consumers at home.
Starbucks said sales at its biggest growth market, China, nearly doubled from the same period a year ago when its stores in the country remained shut due to the health crisis.
The surge, however, was not enough for its markets abroad to beat Wall Street expectations. They rose 35% in the company’s international markets, but missed expectation of 48.25% growth, according to IBES data from Refinitiv.
However, in the Americas region, comparable sales rose 9%, powered by a recovery in the United States, thanks to vaccinated consumers returning to stores or ordering their daily cup of coffee online.
After brewing their own beans at home for over a year, Americans are back at restaurants to pick up their breakfast and coffee, encouraged by easing COVID-19 restrictions, relief checks and rapid vaccinations.
Revenue rose 11% to $6.67 billion for the second quarter ended March 28, falling short of the estimate of $6.82 billion.
The company also raised its forecast for the year in expectation that coffee drinkers will return to their pre-pandemic habits as more consumers get vaccinated.
The company now expects 2021 revenue to be between $28.5 billion and $29.3 billion, up from its prior projection of $28 billion and $29 billion. It expects adjusted earnings per share between $2.90 and $3, compared with $2.70 and $2.90.
Analysts have forecast revenue of $28.61 billion and earnings of $2.85 per share.
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