On July 1, Starbucks announced that it would close 600 company-operated stores in the U.S., resulting in the elimination of 1,000 jobs.
For the full year, Starbucks now expects earnings to be in the mid-70 cent range, excluding a 19-cent year-to-date impact from restructuring and transformation costs. Analysts had predicted full-year earnings of 81 cents a share.
The company attributed its bleak view to declining economic conditions, which has led to a fall-off in customers at its stores.
Lower-than-expected revenue growth in the third quarter came as a result of slowing traffic in the U.S. Starbucks saw a mid single-digit decline in same-store sales, or sales at store open at least a year.International revenue grew 24% to $103.6 million, up from $535.6 million a year ago. The company continued to expand its store presence in its 44 markets outside the U.S., but noted that the revenue growth was dampened somewhat by a slight decline in traffic in the U.K. along with slower sales in Canada.