on late Wednesday warned the weakening consumer environment would hit profits for the second-quarter and full-year.
For the quarter ending March 30, the coffee chain said it expects to post earnings of 15 cents a share, vs. 19 cents a share in the year-ago period. Analysts expect a profit of 21 cents a share.
For the full year, Starbucks sees profit being "somewhat lower" than the 87 cents a share it earned in 2007. Analysts expect a profit of 75 cents a share. The company did not offer a more precise estimate, but said it expected to do so when it reports earnings April 30.
Shares plummeted in recent after-hours action, losing 10.6% to $15.95.
"The current economic environment is the weakest in our company's history, marked by lower home values, and rising costs for energy, food and other products that are directly impacting our customers," said Chairman, President and CEO Howard Schultz. "While this is having a substantial impact on our performance, I am as enthusiastic as I was when I returned to Starbucks as CEO three-and-a-half months ago about our opportunity to reinvigorate the 'Starbucks Experience.'"
Schultz said Starbucks is "aggressively implementing a series of customer-focused initiatives." Those initiatives, however, come at a cost. The company said costs associated with restructuring hit its bottom line by 3 cents a share in the second quarter.
Decreased store traffic also cut into comparable store sales in the mid-single digit range, the company said. The hard-hit housing markets of California and Florida account for 32% U.S. retail revenues and 31% of company-operated retail stores.
The company said it continues to pursue other cost-saving and expense-reducing initiatives.
Starbucks shares closed Wednesday down 1.1% Competitors
( CBOU) and
Peet's Coffee & Tea
( PEET) were mixed in trading Wednesday.
Other coffee purveyors
Green Mountain Coffee
also were mixed in trading.
This article was written by a staff member of TheStreet.com.