Looks like Starbucks Corp. (SBUX – Get Report) needs a shot of espresso. Or at least its sales do.
The Pike Place coffee brewer missed Wall Street’s forecast for total sales in its first-quarter earnings report, posting a net revenue of $6.1 billion compared to analysts’ prediction of $6.2 billion, according to FactSet.
Shares are down more than 3%, or $1.90 apiece, to $58.65 just after 5 pm ET on Thursday, Jan. 25, following the revenue miss. Shares closed Thursday at $60.55.
Starbucks, however, reported an earnings beat, with an EPS of $0.65 to the forecast of $0.57. Meanwhile, global comparable sales increased by 2% in the first-quarter, driven by a 2% average ticket increase, the company said. China posted the strongest growth, at 6%.
Membership also grew in the period: 11% since the same time last year.
Afternoon Jolt: Starbucks stock tanks after earnings call $SBUX https://t.co/DvGFWS3iEj
— Brian Sozzi (@BrianSozzi) January 25, 2018
On a conference call, Starbucks executives highlighted tepid sales of holiday drinks. They also called out pressured sales at Starbucks mall stores.
Starbucks also announced Thursday that it bought back 28.5 million shares of common stock in the quarter and anticipates a cash dividend of $0.30 per share payable on Feb. 23.
In the quarter ending on Dec. 31, 2017, Starbucks opened 700 new locations worldwide and completed its full acquisition of the East China business from joint venture partners, Uni-President and President Chain Store Corporation. Its store count now reaches 28,039.
On Wednesday, Starbucks announced that it would raise employee wages and their benefits package by offering six weeks of paid parental leave for part-time and full-time hourly associates.