Coffee chain Starbucks (SBUX) has issued financial results for the fourth quarter of 2023 that missed Wall Street forecasts across the board as its domestic and international sales declined.
The Seattle-based company reported earnings per share of $0.90 U.S. versus $0.93 U.S. that was expected among analysts.
Revenue in the final quarter of last year totaled $9.43 billion U.S. compared to $9.59 billion U.S. that was forecast on Wall Street. Overall sales rose 8% from a year earlier.
The poor results were blamed on a boycott of Starbucks in the U.S. and increased discounting by rivals in overseas markets, mainly China.
Global same-store sales at Starbucks increased 5% in Q4 2023, though that fell short of analyst estimates of 7.2%.
In its home market of North America, Starbucks’ same-store sales also rose 5%, matching expectations.
Starbucks has faced a backlash from conservative American consumers in recent months over perceptions that it supports Palestinians in the current war between Israel and Hamas.
In a bright spot for the company, Starbucks said that consumers placed $3.6 billion U.S. onto its gift cards over the year-end holidays, a record amount for the company.
However, international same-store sales posted growth of 7% in Q4 2023, missing forecasts of 13.2%.
China, the company’s second-largest market, reported same-store sales growth of 10%. But the cost of the average item purchase at Starbucks in China fell 9%.
While China’s economy is enduring a slowdown, the chain has also seen increased competition from lower-priced rivals such as Luckin Coffee in the nation of 1.4 billion people.
Owing to the poor results, Starbucks revised down its full-year sales outlook.
For all of 2024, the company now anticipates revenue growth of 7% to 10%, down from its previous forecast of 10% to 12% growth.
Starbucks also lowered its global same-store sales outlook to a range of 4% to 6% growth, down from a prior range of 5% to 7%.
The company reiterated its full year forecast of earnings per share growth of 15% to 20%.
Starbucks’ stock has declined 14% in the last 12 months to trade at $94.08 U.S. per share.
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