And Starbucks is set to close hundreds of branches.
Starbucks Corporation (NASDAQ:SBUX) shares fell 3.0% to US$86.96 after its annual revenue report was released. No one was surprised, however, as all retailers of any kind are hurting due to the Covid-19 pandemic.
Starbucks has reported a Q4 9% drop in US sales and a 3% in China sales.
Starbucks earnings fell by $1.2billion. However, the company brought in $6.2 billion in Q4 beating earnings forecasts of just $6.o6 billion.
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— Starbucks Coffee (@Starbucks) November 2, 2020
“I am very pleased with our strong finish to fiscal 2020, underpinned by a faster-than-expected recovery in our two lead growth markets, the U.S. and China. These results demonstrate the continued strength and relevance of our brand, the effectiveness of the actions we’ve taken to adapt to meaningful changes in consumer behavior and the extraordinary efforts of our green apron partners to serve our customers and communities in challenging circumstances,” said Kevin Johnson, president and CEO.
But at the same time Starbucks announced in an earnings call Thursday evening that it would be closing down 200 of its locations in America and Canada. That is in addition to the 400 stores that Starbucks said back in April that it would be closing over an 18 month period.
Remember all those jokes over the years like, “you remember that store don’t you? It’s a Starbucks now. Oh really, which one?”
Or, “It’s next to the Starbucks. You’ll need to be more specific.”
At one point it seemed like there would be a personal Starbucks for each and every American.
Starbucks plans on opening 2,150 locations worldwide in its current fiscal year, in spite of the Corona Virus shutdowns. But with the added store closure the company will only be opening open a net 50 new stores in its Americas segment.
Well there is some good news for Starbucks, though. It will be opening at least one new store in Laos.
“We are pleased to introduce the Starbucks brand into Laos, which further builds on our 20 year relationship with Starbucks to grow the coffee industry across Asia,” said Michael Wu, Chairman and Managing Director of Hong Kong based Maxim’s Caterers Limited. Maxim’s is the parent company of Coffee Concepts (Laos) Ltd., which will operate the Starbucks store in Laos.
So yet another country in the world has finally given in and accepted the inevitability of letting Starbucks open up a branch there. The 7.2 million Laotians are surely rejoicing.
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