Starbucks Notches Improved Sales, Says COO Will Exit -- 3rd Update
By Heather Haddon
Starbucks Corp. said Chief Operating Officer Roz Brewer will
leave to lead another publicly traded company, marking the
departure of a prominent Black executive who helped revive sales
during the coronavirus pandemic and worked to diversify the coffee
Starbucks, which said Tuesday that sales were recovering in
China in particular even as the pandemic has necessitated continued
store closures elsewhere, said Ms. Brewer would depart at the end
of February. Walgreens Boots Alliance Inc. is set to name Ms.
Brewer its next chief executive, people familiar with the matter
told The Wall Street Journal, setting her up to be the only Black
woman leading a Fortune 500 company today.
Ms. Brewer, 58 years old, has been COO and a member of the board
at Starbucks since 2017. She helped shift Starbucks toward a focus
on to-go operations during the pandemic and has worked to diversify
the company's leadership.
Starbucks last fall said it would tie executive compensation to
increasing minority representation in its workforce, and mandated
antibias training for company leaders. Starbucks said CEO Kevin
Johnson will continue to lead the company's diversity efforts. In
March, the company is expected to appoint investor Mellody Hobson
as its chairwoman, positioning the coffee chain to be among the
biggest U.S. companies with a Black person leading its board.
Starbucks's president of its North American business and chief
marketing officer will assume Ms. Brewer's roles and report
directly to Mr. Johnson, the CEO said on a call.
"We're very excited for her and are grateful for her many
contributions over the years," Mr. Johnson said.
Starbucks said Tuesday that global same-store sales fell 5% in
its quarter ended in December from the same period a year earlier.
A quarter earlier, sales by that measure fell 9% from a year
earlier. Same-store sales in China increased 5% year over year in
the latest quarter.
Starbucks is still navigating restrictions imposed by local
officials seeking to curb the new coronavirus's spread. Sales of
$6.7 billion during the quarter were down 5% from the year-ago
period, with Starbucks attributing the decline to fewer customers,
reduced hours and store closures related to the pandemic. Analysts
polled by FactSet anticipated $6.9 billion in sales.
Shares of Starbucks fell nearly 2% to $103 after hours.
Some U.S. states added back restrictions on businesses and
public gatherings this winter as Covid-19 cases have risen,
including bans on indoor dining. Starbucks has said it experiences
an immediate sales lift when customers are allowed back in
In China, where Starbucks stores were largely closed and sales
plummeted when the pandemic took off there early in 2020, sales
have largely bounced back along with the broader economy. Starbucks
said it is investing roughly $150 million to build a roasting plant
in eastern China, one of a number of U.S. companies adding to their
operations in the country now.
The pandemic has prompted Starbucks to reassess the design of
its stores and shift toward more to-go formats. Starbucks plans to
close 800 stores in the U.S. and Canada over the next 18 months as
part of that shift.
Starbucks said it added 278 stores in its first quarter, up 4%
from the previous year. The chain now has 32,938 stores globally.
It said last month that it wanted to have a network of 55,000 owned
and licensed locations around the world by 2030.
For the latest quarter, Starbucks reported adjusted earnings of
61 cents a share, beating analysts' expectations of 55 cents a
share. Earnings of 53 cents a share, on income of $622 million,
were down from 74 cents in the same period last year, with
Starbucks attributing the decrease to the pandemic.
The company expects earnings of $2.42 to $2.62 a share for its
full fiscal year, up slightly from previous guidance.
Write to Heather Haddon at email@example.com
(END) Dow Jones Newswires
January 26, 2021 18:39 ET (23:39 GMT)
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