Starbucks Faces Declining Sales as Investors Anticipate Turnaround by 2025

Sara Myers

2 weeks ago
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Photo by Hamza Inayat

Starbucks Corporation is bracing for another decline in sales as it prepares to report its fiscal first-quarter results, with analysts forecasting a drop in both revenue and earnings year-over-year. The coffee giant is expected to announce net sales of $9.33 billion, down 1% from the previous year, alongside earnings of 68 cents per share, a significant decrease from $1.02 billion or 90 cents per share last year.

The company has faced challenges in recent months, with same-store sales projected to fall by 4.8% year-over-year. Analysts from Jefferies have specifically called for a 6% decline in U.S. same-store sales, citing ongoing issues related to product innovation and a cautious consumer environment.

In light of these struggles, Starbucks has suspended its guidance for fiscal year 2025. CFO Rachel Ruggeri stated that the decision was made to allow the company “ample opportunity to complete an assessment of the business and solidify key strategies” under Niccol’s leadership. The company reported a 7% decline in global same-store sales and a 10% drop in North America during the fourth quarter, leading to concerns about the upcoming fiscal year’s performance.

Analysts have expressed mixed sentiments regarding Starbucks’ future. While some predict a potential rebound under Niccol’s operational reset plan, others warn that 2025 could be a “throwaway year” focused on reinvestment rather than growth.

As Starbucks navigates these challenges, investors are keenly awaiting updates on its strategic direction and performance metrics in the coming weeks.

Sources:
[1] https://finance.yahoo.com/news/starbucks-set-steamy-comeback-analyst-133956297.html
[2] https://www.investopedia.com/what-analysts-think-of-starbucks-stock-ahead-of-earnings-8779873
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[4] https://www.proactiveinvestors.com/companies/news/1056831/starbucks-may-face-throwaway-year-in-2025-analysts-warn-as-stock-downgraded-1056831.html
[5] https://study.com/learn/lesson/newspaper-article-format-examples.html
[6] https://www.craverapp.com/blog/starbucks-marketing-strategy
[7] https://spcollege.libguides.com/c.php?g=254319&p=1695316
[8] https://www.investopedia.com/starbucks-suspends-its-outlook-for-2025-sending-stock-lower-8732512
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