Starbucks gross sales falter in China due to Covid restrictions

Starbucks sales falter in China because of Covid restrictions

In the three months ending on July 3, sales at Starbucks’ Chinese locations open at least 13 months dropped 44%.

“China faced its most severe COVID disruption since the onset of the pandemic,” in the quarter, said Belinda Wong, chairman of Starbucks China, during a Tuesday analyst call discussing the results. “Mobility restrictions and lockdowns were implemented faster and eased more slowly under China’s zero-Covid policy,” she said, adding that Shanghai, Starbucks’ largest market, was totally locked down for about two-thirds of the quarter.

Starbucks’ international sales fell 18% in the quarter, dragged down by poor results in China. Discounting the sales drop there, international growth would have been up by double digits, the company said Tuesday.

China’s zero-Covid policy has made it difficult for individuals and companies to get back to business as usual. That’s a problem for Starbucks, which counts China as one of its most important markets. Starbucks has about 5,760 Chinese…