Earnings

Starbucks suspends its outlook as Covid lockdowns hammer sales in China

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A pedestrian carries a Starbucks branded cup in San Francisco, California, U.S., on Thursday, April 28, 2022. Starbucks Corp.
David Paul Morris | Bloomberg | Getty Images

Starbucks is expected to report earnings after the bell on Wednesday.

Here’s what Wall Street analysts surveyed by Refinitiv are expecting:

  • Earnings per share: 59 cents expected
  • Revenue: $7.6 billion expected

It’s Howard Schultz’s first earnings report since assuming the top job in early April. In his first month as interim CEO, Schultz has paused stock buybacks and embarked on a listening campaign with baristas nationwide to curb the growing union push. About 50 company-owned locations have voted in favor of unionizing in the last six months.

As Schultz shows his willingness to spend on defeating the union, Wall Street has backed away from the stock. Shares have fallen 18% since he took the helm again. He’s expected to stay in the role until the fall, when a permanent successor will take the role.

China’s sluggish recovery has taken a backseat in investors’ concerns about the stock. The country, which is Starbucks’ second-largest market, has reimposed lockdowns as new Covid outbreaks occur, hurting demand for the chain’s coffee and tea.

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