Starbucks sales fall less than expected as U.S. and China markets rebound from pandemic

People wear protective face masks outside Starbucks in Union Square as the city continues Phase 4 of re-opening following restrictions imposed to slow the spread of coronavirus on September 29, 2020 in New York City.

Noam Galai | Getty Images

Starbucks on Thursday reported that sales in the U.S. and China are recovering from the coronavirus pandemic more quickly than expected, helping global same-store sales shrink just 9%.

The company also released an outlook for fiscal 2021, projecting a healthier year than expected by analysts.

Shares of the stock rose more than 1% in after-hours trading.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: 51 cents, adjusted, vs. 31 cents expected
  • Revenue: $6.2 billion vs. $6.06 billion expected

Starbucks reported fiscal fourth-quarter net income of $392.6 million, or 33 cents per share, down from $802.9 million, or 67 cents per share, a year earlier.

Excluding items, the coffee chain earned 51 cents per share, beating the 31 cents per share expected by analysts surveyed by Refinitiv.

Net sales dropped 8% to $6.2 billion, topping expectations of $6.06 billion. Global same-store sales fell 9%. While customers are spending more on their coffee orders, Starbucks saw the number of transactions fall.

In the United States, same-store sales fell 9%. In China, its second-largest market, same-store sales declined by just 3%.

In fiscal 2021, Starbucks expects revenue of $28 billion to $29 billion. The company forecasts adjusted earnings of 50 cents to 55 cents for the fiscal first quarter and a range of $2.70 to $2.90 for the full year. Starbucks expects global same-store sales growth of 18% to 23% for the year, with U.S. same-store sales forecast to increase 17% to 22% and China same-store sales growth of 27% to 32%.

Starbucks anticipates 1,100 net new stores in fiscal 2021.

Read the full earnings report here.

This is breaking news. Please check back for updates.

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