- Starbucks reported quarterly earnings Tuesday that missed Wall Street’s expectations for earnings per share.
- CEO Kevin Johnson said on a call with analysts that comparable sales for open stores turned positive in July – a sign that the company’s recovery from the coronavirus pandemic lockdowns is picking up.
- Shares jumped as much as 6% in premarket trading Wednesday.
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Shares of Starbucks jumped as much as 6% in premarket trading Wednesday after the company’s July sales showed signs that the company’s recovery from the coronavirus pandemic lockdowns is picking up.
On a call with analysts Tuesday, Starbucks CEO Kevin Johnson said that comparable sales for open stores turned positive in July, indicating that the company’s strategy to weather the pandemic is working and fuelling hopes that the worst of the lockdown is over.
“We have now developed new levels of agility and resilience that position us well for the future with the mindset and capability to safely, effectively and confidently drive our continued recovery,” Johnson said. “We recognise that markets will experience varying levels of COVID-19 impact until new therapeutics and vaccines are developed, and we are well positioned to navigate this phase of the pandemic.”
There are 3,100 Starbucks stores that have remained open for the entire quarter, compared to the more than 8,800 total that the company operates in the US.
Still, the quarter was less than rosy for the coffee chain. Global same-store sales fell 40% during the quarter that ended June 28, and US same-store sales also plunged 40% in the same timeframe.
In addition, Starbucks revised its fourth-quarter earnings forecast down slightly, and narrowed its outlook for US same-store sales for the rest of the year – the company now expects same-store sales to decline between 12% and 17%, from previous estimates of 10% to 20%.
Starbucks has shed 15% year-to-date through Tuesday’s close.