Starbucks’ CEO on Q2 2024 consolidated results: Results do not reflect our strengths

Starbucks’ revenue for the second quarter dropped by 2% year over year to reach $8.6 billion. Adjusted earnings per share also declined down 8% to $0.68.

According to the company’s quarterly results, global same-store sales declined 4% from a year ago, as transactions dropped 6%. The results also mention that the net revenues for the international segment declined by 5% in Q2 FY24 versus Q2 FY23. This was primarily driven by an approximate 5% unfavorable impact from foreign currency translation and a 6% decline in comparable store sales.

Addressing the situation on social media, CEO Laxman Narasimhan states, that these results don’t reflect their strengths. He called it “a highly challenged environment.”

“What they (results) reflect is a challenging operating environment and headwinds across many of our key markets,” he states.

The CEO announced some immediate measures the brand is undertaking in the U.S and its international markets like introducing newer products, meeting the morning demand, and to offer value to the occasional Starbucks customer.

“Around the world we continue to build new stores that create value and connect with our customers in locally relevant ways. While we are not pleased with the results, we operate from an unparalleled position of strength anchored in a distinctive partner culture, coffee and resilient and enduring brand with accelerated action supported by our 'Triple Shots with two pumps' plan. We are confident in the long term,” says Narasimhan.

As per media reports, this is Starbucks' first quarterly sales decline since 2020, when COVID disrupted global operations.

A few months ago in January Starbucks had reported that its first-quarter profits fell short of market forecasts, citing the ‘events in the middle east’.