Starbucks Corp missed Wall Street’s forecast for quarterly comparable sales on Tuesday, hampered by weakness in its international market, where the COVID-19 pandemic has prompted governments to limit travel and close cafes.
In extended trading, shares of the Seattle-based coffee company dropped around 3%.
Consumers worked from home and made their coffee and breakfast at home, but the coffee chain, like other restaurant chains, has suffered for over a year. More customers stayed at home due to recent lockdowns in parts of Asia and Europe.
Starbucks said sales in China, its biggest growth market, nearly doubled compared to the same time a year earlier, when the country’s stores were closed due to the health crisis.
The boom, however, was insufficient for its markets outside of the United States to outperform Wall Street expectations. According to IBES data from Refinitiv, they increased 35 percent in the company’s international markets, but fell short of expectations of 48.25 percent expansion.
Americans are returning to restaurants to pick up their breakfast and coffee after brewing their own beans at home for over a year, motivated by relaxing COVID-19 limits, relief tests, and accelerated vaccinations. The company also increased its year-end outlook, predicting that as more people get vaccinated, coffee drinkers will return to their pre-pandemic habits.
The company now expects sales of $28.5 billion to $29.3 billion in 2021, up from its previous forecast of $28 billion to $29.3 billion. It expects adjusted earnings per share of $2.90 to $3, up from $2.70 to $2.90 previously.