SBUX Starbucks Corporation

By Chelsey Dulaney 

Starbucks Corp. on Thursday offered a soft earnings outlook for its current quarter, despite posting strong core sales growth and better-than-expected profit for the fiscal first quarter.

For the second quarter, Starbucks forecast adjusted earnings of 38 cents to 39 cents a share, below Wall Street's consensus forecast of 40 cents, according to Thomson Reuters.

Shares fell 4.4% to 56.45 in after-hours trading.

The disappointing forecast came as Starbucks reported an 8% increase in same-store sales for the quarter ended Dec. 27, topping analysts' forecast for 7.3% growth.

Starbucks cited strong gift card sales during the holiday period and higher traffic, which grew 4% on a same-store basis in the quarter.

But growth disappointed in its China and Asia Pacific division, where same-store sales rose 5%. That was below the 6.1% growth analysts had forecast.

Starbucks has set a torrid pace of growth in Asia in recent quarters, but concerns are mounting over a slowdown in China's economy.

Starbucks has also been working to expand its offerings beyond coffee with more food items and alcohol. It has been focusing on digital efforts and launched a mobile ordering and pay app in September. Altogether, the efforts have helped drive strong momentum at its Americas business, which includes the U.S., Canada and Latin America.

In the latest quarter, same-store sales in the that division rose 9%. Analysts had forecast 7.7% growth.

Overall, Starbucks reported earnings of $687.6 million, or 46 cents a share, down from $983.1 billion, or 65 cents a share, a year earlier. The prior-year period was boosted by a $391 million gain related to a joint venture.

Starbucks had forecast earnings of 44 cents to 45 cents a share for the quarter.

Revenue rose 12% to $5.37 billion. Analysts had forecast $5.39 billion in revenue.

Starbucks backed its forecast for full-year adjusted earnings of $1.87 to $1.89 a share and same-store sales growth just above the mid-single digits.

Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com

(END) Dow Jones Newswires

January 21, 2016 16:42 ET (21:42 GMT)

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