The global coffee giant Starbucks suffered a severe blow on May 1.SlotostarscasinoIt was down more than 14% at the start of the day, then fell all the way down, closing down by 15%.Slotostarscasino.88% to $74.44, the market capitalization lost about 115 billion yuan in just one day, the biggest decline since March 2020.
The sharp fall in Starbucks' share price is related to its latest financial results on April 30. In the second quarter of fiscal 2024 (January 1-March 31, 2024), Starbucks' revenue and earnings per share were lower than market expectations. In particular, same-store sales fell 4 per cent year-on-year, the first decline since 2020, compared with market expectations of a 1.46 per cent rise. Some analysts pointed out that Starbucks' results for the quarter may be the worst of any big company so far.
In the second quarter of fiscal 2024, Starbucks' net profit attributable to ordinary shareholders was $772 million, down 14.96% from a year earlier, while operating revenue was $8.563 billion, down 1.8% from a year earlier, according to financial data. Same-store sales fell 4% in the second quarter, while analysts expected growth of 1.46%. In the second quarter, same-store sales in the United States fell 3%, and analysts expected growth of 2.31%.
Although average consumption has increased by 2 per cent, it has not fully offset the impact of the decline. To boost sales, Starbucks tried a series of new strategies, including afternoon promotions and the launch of new products such as lavender lattes, but the results showed that these measures did not significantly improve performance.
In a conference call with investors, Starbucks cut its full-year revenue growth forecast to low digits and hinted that adjusted earnings per share could be flat.
Subsequently, JPMorgan lowered the target price of Starbucks to $92 from $100, and Deutsche Bank downgraded Starbucks to hold. Investment bank William Blair also downgraded Starbucks' stock recommendation rating.
