Starbucks says terror threats and civil unrest have people drinking less coffee

Political uncertainty is hitting the firm's bottom line according to its boss...

Starbucks says terror threats and civil unrest have people drinking less coffee

A lagre cup of Starbucks coffee sits outside a Starbucks in Washington | Image: Pablo Martinez Monsivais / AP/Press Association Images

Starbucks has cited political and social unrest in the US and abroad as contributing factors to the company missing earning targets for the third quarter in a row.

It referred to the quarter as an "anomaly" and said that instability and terror threats affected the firm's performance, Starbucks also said that there has been a "profound weakening in consumer confidence" among its customers.

Chief Executive Howard Schultz said, "In Starbucks’s 24 years of public life, I can’t recall a quarter quite like [this one]" in a conference call discussing the results.

"I think we have a situation where you have a very uncertain [US] election, you have domestic civil unrest with regard to race, and I think the issues around terror have created a level of anxiety - so we are no longer looking at just an economic downturn, there are a number of things that we are facing as citizens and I think the direction of the country," he continued.

The company's shares experienced a 3% fall in after-hours trading following the publication of the results.

Starbucks returned an overall profit of $754m - up from $626.7m 12 months ago. During the quarter like-for-like sales in Europe, the Middle East and Africa fell by 1%. These regions were expected to deliver growth of 2.8%.

The firm had projected sales growth of at least 10% in 2016.

Its immediate plans include investment in mobile ordering and payment services to make its stores more efficient.

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