New York City Shuttering stores, laying off workers and cutting other costs helped Starbucks Corp. beat Wall Street's profit expectations for its fiscal third quarter Tuesday, but the recession continued to drain sales away from the gourmet coffee chain.
CEO Howard Schultz said on a conference call with investors that the quarter's results showed "positive momentum," but there was more work to be done. "A lot of hard work lies ahead," Schultz said. "One quarter does not make a trend."
The company earned $151.5 million, compared with a loss of $6.7 million a year earlier. Revenue fell 7% to $2.40 billion.
Starbucks' same-store sales dropped 6% in the U.S. and 5% worldwide. The number of transactions and their average value both slipped.
On the positive side, sales improved each month during the quarter, and the third-quarter sales decline was less steep than the second quarter's 8% drop.
For 2010, Starbucks said its profit will grow between 13% and 18%, excluding restructuring charges.