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COVID-19

Starbucks’ results top estimates but coronavirus slows sales

FILE - In this Jan. 16, 2020, file photo cCustomers come and go at a Starbucks on South Claiborne Ave. in New Orleans on Jan. 6, 2020. Starbucks Corp. reported financial earns on Tuesday, Jan. 28. (Gerald Herbert / AP)
By Dee-Ann Durbin Associated Press

It was a happy holiday at Starbucks, but the company’s sales momentum could start to slow because of the coronavirus outbreak in China.

New drinks like the Pumpkin Cream Cold Brew were a hit with customers, helping the Seattle-based coffee giant beat Wall Street’s forecasts in the October-December period. Starbucks reaffirmed its 2020 profit guidance for now, but said it has already closed more than half of its stores in China.

Starbucks reported Tuesday its earnings rose 16% to $886 million in its fiscal first quarter. Earnings, adjusted for non-recurring items like restructuring charges, were 79 cents per share. That beat Wall Street’s forecast of 76 cents.

Starbucks said same-store sales – or sales at stores open at least 13 months – jumped 5% worldwide in the October-December period, ahead of analysts’ forecasts of 4.4%. Revenue was up 7% to $7.1 billion, in line with analysts’ forecasts.

Starbucks said 1.4 million U.S. customers joined its Starbucks Rewards loyalty program during the quarter. The company said demand for mobile ordering and payment is growing in the U.S.