Starbucks Posts First Profit Decline in 8 Years
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Starbucks Corp., the world’s biggest chain of coffee shops, forecast its first annual profit decline in eight years as sales at its American stores slowed, causing the company’s shares to drop 11% in late Nasdaq trading.
Profit in the year through September will probably trail the $0.87 a share the company posted last year, the Seattle-based company said yesterday in a statement. Analysts surveyed by Bloomberg estimated $0.97 a share for the year.
“This is all very serious stuff,” an analyst at Edward Jones & Co. in St. Louis, Jack Russo, said in a telephone interview. “The company has revised the earnings guidance pretty dramatically.” Mr. Russo has a neutral rating on the stock.
The founder of the company, Howard Schultz, returned as chief executive officer in January after two quarters of customer declines erased almost half of the company’s stock market value.
