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SBUX Summary: Struggling in Weak Consumer Environment

By Tim Melvin

 About this article:
 Starbucks released earnings for the quarter ended March 31 in line with reduced expectations. The company reported total earnings of $108.7 million, or 15 cents a share compared to $150.8 million or 19 cents a share in the year-ago period. Revenue rose 12% for the quarter to $2.5 billion, but overall profit margins declined. Analysts had expected 15 cents but had a slightly higher forecast of $2.63 billion in revenue. Although lower payroll costs helped SG&A expenses drop by 4.75% in the quarter, the overall margins fell to just 7.15% down from 10.7% last year. The margin decline was a result of reduced traffic and much higher store operating expenses. The company attributed the increase in store costs to the expense related to the recently announced transformation plans for the company's stores in the United States. Revenue in the United States, which account for 77%...

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