Starbucks' sales are on the upswing again, but the company says its turnaround efforts are far from complete.
The coffee giant said Tuesday that its quarterly revenue rose 2% to $8.76 billion in the January-March period. It was Starbucks’ first quarterly revenue increase in more than a year.
Still, Starbucks' revenue was short of Wall Street’s expectations of $8.83 billion, according to analysts polled by FactSet.
Starbucks Chairman and CEO Brian Niccol, who joined the struggling company last fall, said Starbucks' fiscal second quarter results show that its efforts to simplify operations and improve service times are paying off.
“My initial optimism has turned to clear confidence. We are where we should be at this point in our turnaround,” Niccol said in a video message to employees.
But those efforts have been costly. Starbucks said its net income dropped 50% to $384 million in its fiscal second quarter. Adjusted earnings fell nearly 40% to 41 cents per share. That was lower than the 49-cent per share profit Wall Street forecast.
The Seattle company said its same-store sales, or sales at locations open at least a year, fell 1% globally. That was slightly worse than the 0.8% drop analysts forecast.
While international same-store sales increased 2% — and store traffic improved in China — U.S. same-store sales fell 2%.