Starbucks sales decrease due to weak Chinese performance

Starbucks reported fiscal first-quarter earnings and revenue that fell short of analysts' expectations due to weak international demand, particularly in China. The Chinese government's zero Covid policy led to new outbreaks of the virus, leading to a 28% drop in transactions at cafes open at least 13 months. Despite the weak performance in China, Starbucks reported net income of $855.2 million, or 74 cents per share, and net sales rose 8% to $8.71 billion globally. Same-store sales in the U.S. rose 10% due to customers spending more and a 1% bump in traffic, while same-store sales shrank 13% outside its home market due to the weak performance in China. However, the company's same-store sales in China have already begun to improve, with a 15% drop in January. Looking to 2023, Starbucks is projecting revenue growth of 10% to 12% and adjusted earnings per share growth on the low end of 15% to 20%. A new CEO, Laxman Narasimhan, is set to take over on April 1.