Starbucks is partnering with UberEats for delivery from about 3,500 U.S. stores and is nearly doubling its outlets in China over the next four years, but forecast that same-store sales would remain steady, sending shares down 3 percent. Roselle Chen reports.
(Reuters) – Starbucks is partnering with UberEats for delivery from about 3,500 U.S. stores.
It’s also doubling its outlets in China over the next four years.
That’s what Starbucks executives said during an investor day in New York City.
But they also said the company’s same-store sales won’t grow much, and that sent its stock plunging.
Clear Harbor Asset Management’s CEO Aaron Kennon:
CLEAR HARBOR ASSET MANAGEMENT’S CHIEF EXECUTIVE OFFICER AARON KENNON,
“Starbucks, of course, as we all know, is a wonderful brand. They’ve grown double digits for a long, long time. They’re a very global company, and they continue to grow. But the storyline is that they may not be growing now as quickly as analysts had hoped on a go forward basis. And, I think, in this sort of market climate of uncertainty, of deceleration of economic growth, just a move from ten percent growth expectation, excuse me, from 12 percent growth expectations to ten percent growth expectations is enough to sort of wreak a little bit of havoc in its stock price, and I think that’s what we’re seeing today.”
To better compete with smaller coffee shops, Starbucks has been revamping its stores, closing Teavana tea houses, laying off workers, and adding new items to its menu.
The delivery service initiative is now being tested in Miami.
It will most likely launch in nearly one-quarter of the company-owned U.S. stores in March.