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Starbucks Says Pandemic Will Cut Up to $3.2 Billion of Revenue

Starbucks said the pandemic would cut up to $3.2 billion of revenue, and it reported U.S. same-store sales fell 43% in May, improved from April.
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Starbucks  (SBUX) - Get Free Report said the coronavirus pandemic would slash revenue by $3 billion to $3.2 billion for the fiscal third quarter ending this month. 

Starbucks also reported in a Securities and Exchange Commission filing that U.S. same-store sales fell 43% in May from a year earlier. That was improved from the 63% dive in April.

Comparable-store sales slid 32% in the final week of May, representing the sixth consecutive week of improvement.

The company also said that it opened 57 new shops in China during April and May and that 91% of all U.S. stores were open as of May 31.

In addition, it’s making a transition toward pickup stores in the U.S.

“We’re accelerating plans to transform our store portfolio over the next 18 months,” Starbucks Chief Executive Kevin Johnson said in a letter to shareholders. 

“Based on the preferences that we’re seeing, we are pulling forward our original plans to evolve our retail footprint, particularly in major U.S. cities to have a blend of traditional Starbucks cafés and Starbucks Pickup locations.”

This includes the expansion of new Starbucks pickup stores in New York, Chicago, Seattle and San Francisco, and the design of convenience-led enhancements such as curbside, drive-through and walk-up windows in suburban areas.

Meanwhile, in China, Starbucks said comparable-store sales dropped 21% in May compared with 32% in April.

Starbucks shares at last check stood at $79.85 off 3.1%. The shares have climbed 16% in the past three months.  They remain 17% below their 52-week high just under $100, set late last July.