Kevin Johnson, CEO, Starbucks
Scott Mlyn | CNBC
Starbucks released Wednesday a weaker-than-expected forecast for its fiscal 2020 earnings.
Shares of the company slid more than 3% in premarket trading.
Starbucks said that it expects fiscal 2020 earnings per share to be below its “ongoing growth model of 10%.”
The company released the outlook in a slideshow for a presentation by CFO Pat Grismer at Goldman Sachs’ Global Retailing Conference.
Grismer said that one-time tax benefits realized in fiscal 2019 will be a significant headwind to earnings growth in fiscal 2020. He also said that Starbucks decided to purchase about $2 billion worth of shares in fiscal 2019 instead of fiscal 2020.
“But again, I want to reinforce that our growth-at-scale agenda is delivering against our expectations,” Grismer said. “I would say that we’re firing on all cylinders from an operating performance perspective with the focus and discipline necessary to drive growth at scale for a company like Starbucks and our long-term double-digit EPS growth model is fully intact.”
Starbucks also reiterated its guidance for fiscal 2019, expecting earnings per share in a range of $2.80 to $2.82.
Despite market concerns about a recession in the near future, CEO Kevin Johnson said on CNBC’s “Mad Money” in August that Starbucks has not seen any signs of an economic slowdown in the U.S.
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