{"id":7190,"date":"2024-05-02T08:00:06","date_gmt":"2024-05-02T15:00:06","guid":{"rendered":"https:\/\/jasonsblog.ddns.net\/?p=7190"},"modified":"2024-05-02T09:19:19","modified_gmt":"2024-05-02T16:19:19","slug":"starbucks-on-brink-of-worst-crash-since-dot-com-after-stunning-earnings-miss","status":"publish","type":"post","link":"https:\/\/jasonsblog.ddns.net\/index.php\/2024\/05\/02\/starbucks-on-brink-of-worst-crash-since-dot-com-after-stunning-earnings-miss\/","title":{"rendered":"Starbucks On Brink Of Worst Crash Since Dot Com After “Stunning” Earnings Miss\u00a0"},"content":{"rendered":"\n

I’m surprised Charbucks is lasting this long, as they have a terrible product with severely overroasted coffee beans (headline story below). Consequently, I’ve posted<\/a> about how I buy green arabica coffee beans and roast them myself at home, and for good quality green coffee beans the prices have been going up on my last two orders (I order 15 lbs at a time). Of course this is for quality green arabica coffee beans from Ethiopia which is my favorite coffee origin, and you can include the rest of NE Africa for having great coffee too. So even though Starbucks is keeping prices just below $5 for their main hot drinks, they’re going to have pressure to raise prices or squeeze margins. Interestingly, their profit in North America is 18%, so could they forgo profit to keep the price down? So out of that $4.65 Caffe Mocha, they’re making $0.84 in profit, indicating their overhead and having so many locations is really costing them a lot of money. And they also claimed to spend more on health care for workers than they do on coffee which should get the CEO fired. And their siren logo with legs\/tails held apart in a sexual way is pretty creepy, and originally included exposed breasts, which tells you something about the founders and corporate management. Anyway, there is no compelling reason to own this stock or drink any of their inferior products.<\/p>\n\n\n\n

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https:\/\/www.zerohedge.com\/markets\/starbucks-brink-worst-crash-dot-com-after-stunning-earnings-miss<\/a><\/p>\n\n\n

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By Tyler Durden<\/p>\n\n\n\n

Starbucks shares plummeted by 16% during the early cash session, approaching the -16.2% level last seen during the Covid crash. If intraday losses surpass 16.2% and remain above this level at closing, it would mark the company’s worst single-day loss since the Dot Com crash in early 2000.<\/p>\n\n\n\n

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“Starbucks reported what’s perhaps the worst set of results of any large company so far” this quarter, analyst Adam Crisafulli of Vital Knowledge wrote in a note. William Blair downgraded the coffee chain, citing last quarter’s “stunning across-the-board miss on all key metrics.”<\/p>\n\n\n\n

Starbucks reported a 4% drop in same-store sales in the second quarter compared with the same period last year, while analysts tracked by Bloomberg were expecting growth. In China, same-store sales plunged 11%. The company’s top geographic segments are showing a pullback in consumer spending. <\/p>\n\n\n\n

On Tuesday evening, CEO Laxman Narasimhan started the earnings call with investors by clarifying his unhappiness with last quarter’s results. <\/p>\n\n\n\n

“Let me be clear from the beginning. Our performance this quarter was disappointing and did not meet our expectations,” Narasimhan said. <\/p>\n\n\n\n

He said major headwinds originate from a “cautious consumer,” adding, “A deteriorating economic outlook has weighed on customer traffic and impact felt broadly across the industry.” <\/p>\n\n\n\n

Here’s a snapshot of the second quarter’s earnings results (list courtesy of Bloomberg):<\/p>\n\n\n\n