Starbucks Shares Plummet Following Disappointing Q4 and Full Fiscal Year 2024 Results

Starbucks Corporation (NASDAQ: SBUX) saw its stock prices decline significantly following the release of its preliminary fourth-quarter (Q4) and full fiscal year 2024 results. The coffee giant reported a 7% drop in global comparable store sales for Q4, with consolidated net revenues decreasing by 3% to $9.1 billion. This performance was below expectations, contributing to a decline in the company’s stock value.

The financial results highlighted several key challenges. For Q4, the company’s GAAP and non-GAAP earnings per share (EPS) were $0.80, a 25% year-over-year decline. For the full fiscal year 2024, GAAP and non-GAAP EPS were $3.31, down 8% from the previous year. U.S. comparable store sales fell by 6%, while China‘s comparable store sales dropped by 14% in Q4.

The softness in North America‘s revenues, particularly a 10% decline in comparable transactions in the U.S., was a significant factor in the disappointing results. Despite efficiency efforts, the company was unable to offset the impact of declining traffic, according to Rachel Ruggeri, the chief financial officer.

In response to these challenges, Starbucks has suspended its guidance for fiscal year 2025 to allow time for a thorough business assessment and the development of new strategies. CEO Brian Niccol has unveiled a ‘Back to Starbucks’ plan aimed at refocusing on the company’s core strengths and improving performance.

Despite the financial setbacks, the company’s Board of Directors approved an increase in the quarterly cash dividend from $0.57 to $0.61 per share, reflecting a commitment to creating shareholder value).