Starbucks Corp on Thursday posted quarterly cafe sales growth that missed analysts’ estimates as demand fell in all major markets, sending its shares down almost 4%.
The world’s largest coffee chain said global sales at company-owned cafes open at least 13 months rose 4% in the fiscal third quarter ended June 26 from the year-ago period. That was well short of the 5.6% gain analysts had expected, according to research firm Consensus Metrix.
Sales at established cafes in the U.S.-dominated Americas region grew 4%, short of analysts’ call for a 6.1% gain, after rising 7% in the second quarter and 9% in the first quarter.
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The number of transactions in U.S. Starbucks cafes, which contribute the lion’s share of company sales and profits, was flat for the quarter.
Chief Operating Officer Kevin Johnson attributed that to Starbucks’ Frappuccino hour promotion starting a week later than last year and a change to the company’s rewards program that took away the incentive to split orders to get more points.
Starbucks, which is investing in mobile ordering and payments to serve customers faster, has been under fire from employees who say a recent move to cut labor hours has hurt take-home pay, morale and customer service.
Net income rose 20% to $754.1 million, or 51 cents per share. Revenue was up 7% to $5.24 billion.
Analysts had expected earnings of 49 cents per share on revenue of $5.33 billion, according to Thomson Reuters I/B/E/S.
Starbucks shares fell 3.7% to $55.50 in extended trading.