Starbucks same-store sales dropped 40% during a challenging Q3 impacted by COVID-19

The coffee chain’s global same-store sales nosedive was driven by 51% decrease in traffic, slightly offset by ticket growth

 

Joanna Fantozzi, Nation's Restaurant News 

Jul 28, 2020

 

Starbucks swung to a loss on Tuesday as the coffee chain reported a 40% decrease in global same-store sales driven by a 51% drop in traffic during a challenging Q3 ended June 28 marred by the astronomical effects of the COVID-19 pandemic. The disappointing quarter — accentuated by café closures and a significant decrease in daily commuters — was offset by a 23% increase in ticket growth.

 

U.S. same-store sales were down 41% with a 53% decrease in traffic, while international sales were down 37%, driven by 44% decline in traffic.

 

“Starbucks partners have risen to the occasion, and our near-term focus is to recover sales safely and responsibly by offering our customers the comfort and care that differentiate the Starbucks Experience,” Starbucks president and CEO Kevin Johnson said in a statement. “We are pleased to share that the vast majority of Starbucks stores around the world have reopened and our global business is steadily recovering, demonstrating the relevance of the Starbucks brand and the trust we have built with our customers.”

 

Despite challenges, the coffee chain’s road to recovery has been a long time in the making. Starbucks reopened more than 90% of its U.S. stores by June, adding new features to make the transition to “the new normal” easier for customers, including curbside pickup and entryway handoff options at select locations. Despite the accelerated reopening plan, Starbucks began asking landlords for rent relief through 2021 as the chain struggled to deal with improving their balance sheet during the global pandemic.

 

In their latest business update in June, Starbuck announced that they would be closing 400 U.S. stores in their pivot to an express store portfolio and cautioned investors of their ongoing financial struggles, stating that while they believe that “same-store sales will normalize by Q4 2020 in China,” they anticipate that U.S. sales will continue to struggle throughout the remainder of 2020...

 

more

https://www.nrn.com/quick-service/starbucks-same-store-sales-dropped-40-during-challenging-q3-impacted-covid-19