- Starbucks (NDAQ:SBUX) is fending off several law firms in a class-action lawsuit over its Q2 2024 financial results
- The Seattle-based coffee company’s Q2 2024 financial results came out far below expectations and its own projections, leading to a reduction in its full-year guidance for 2024.
- Law firms are building their case against Starbucks, call the coffee roaster’s public statements false and materially misleading, adding that investors suffered damages
- Starbucks stock last traded at US$94.86
Starbucks (NDAQ:SBUX) is fending off several law firms in a class-action lawsuit over its Q2 2024 financial results.
The Seattle-based coffee company’s Q2 2024 financial results came out far below expectations and its own projections, leading to a reduction in its full-year guidance.
Law firms such as Levi & Korsinsky are building their cases against Starbucks, who as defendants, stated that store sales had declined globally 4 per cent, with traffic falling 7 per cent, and further disclosed a 2 per cent decline in new revenues to US$8.6 billion. On the back of these results, Starbucks also lowered its guidance for fiscal 2024, citing global declines in store sales, net revenues and earnings.
Starbucks blamed the “impact of a more cautious consumer” in its follow-up conference call with investors and admitted it “may persist longer, but much is within our control.”
Bronstein, Gewirtz & Grossman is investigating potential claims on behalf of investors and quoted analysts’ comments that Starbucks’ “magnitude of the revision was unsettling,” regarding its new projections.
A complaint investigated by the Schall Law Firm is looking into the legitimacy of the blame made by Starbucks executives into the downtrend on global sales declines, which was said to be led by poor performance in China. They call the company’s public statements false and materially misleading, adding that investors suffered damages when the market learned the truth about Starbucks.
Even looking back to August last year, investors were skeptical after the coffee giant recorded its strongest average weekly sales in its history at the time during Q3 2023, but its domestic sales had slowed down.
Established in 1971, Starbucks Corp. is a coffee roaster with more than 39,000 stores worldwide.
Starbucks (NDAQ:SBUX) stock last traded at US$94.86 and has risen 20.44 per cent in the past three months, but lost 1.20 per cent since the year began.
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(Top photo of a Starbucks coffee via X)