Starbucks facing "pronounced traffic decline" as sales fall

State of play: Comparable sales fell 7% globally during the period that ended Sept. 29, compared with a year earlier, the company said Thursday in a surprise earnings preview.

• That included a 6% comparable sales drop in the U.S. and a 14% decline in China.
• Earnings per share fell 25%, and total revenue was down 3%.
• Starbucks said it experienced a "pronounced traffic decline" as well as "a cautious consumer environment" and a failure of its own investments to make an impact.

The big picture: After reinventing Chipotle, Niccol is under pressure to do the same at Starbucks, having started the job on Sept. 9.

• The quarterly "performance makes it clear that we need to fundamentally change our strategy so we can get back to growth," Niccol said in a statement.
• "I've spent my first several weeks in stores engaging with and listening to feedback from our partners and customers. It's clear that Starbucks is a much-loved brand. We need to focus on what has always set us apart — a welcoming coffeehouse where people gather and where we serve the finest coffee, handcrafted by our skilled baristas."

What's next: Starbucks said it would not provide earnings guidance for the next year as Niccol implements what the company called a "strategic reset."

The impact: Starbucks shares fell 2.9% in after-hours trading to $94.