Starbucks Reports a Slide in Sales and Traffic

Published On Oct 22, 2024, 6:30 PM

Starbucks has reported a significant decline in same-store sales, with a 7% drop globally for the quarter ending in September, including a 6% decline in North America and a 14% drop in China. The company is facing challenges such as increased competition, changes in consumer spending behavior, and issues with its service model. The newly appointed CEO, Brian Niccol, acknowledged the need for a fundamental strategy change to reverse the downward trend in sales and traffic. Starbucks stock fell over 4% in after-hours trading following the news, and the company is set to provide more details on its turnaround plan on October 30.

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Stock Forecasts

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Negative

Given the steep decline in sales and the challenges presented by competition and changing consumer habits, Starbucks is likely to continue struggling in the short term. Unless strong corrective measures are successfully implemented, including strategy changes and service improvements, the investment outlook remains cautious.

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