Starbucks posts disappointing Q4 results as new CEO Brian Niccol looks to return to the basics

Published On Oct 30, 2024, 4:10 PM

Starbucks reported disappointing Q4 results, with revenue declining 3% year-over-year to $9.1 billion, and adjusted earnings per share dropping 25% to $0.80. Same-store sales fell 7%, missing expectations significantly, with North America down 6% and a steep 14% drop in China due to competition and lower consumer spending. CEO Brian Niccol announced plans to simplify the menu, improve pricing and service, and return to core brand values after acknowledging the need for a strategic overhaul. The company also suspended its full-year fiscal 2025 guidance while seeking ways to rebuild its customer base and employee culture.

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Stock Forecasts

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Negative

Starbucks is currently in a challenging situation with its performance metrics showing significant declines. The new CEO's initiatives indicate a strong intention to improve the company's fortunes by focusing on the fundamentals. However, the immediate outlook is uninspiring, particularly with the tough competition and reduced consumer spend noted in the report. Given the disappointing results and lack of guidance, the sentiment surrounding the stock is likely to be negative in the short term.

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