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Daily Trends Now


Starbucks posts disappointing sales figure, will sell Tazo

"With our growth strategy for premium tea exclusively focused on Teavana, we are pleased to transition our Tazo business to Unilever", said Kevin Johnson, president and CEO, Starbucks. It is sold primarily in grocery, mass and convenience channels, available in packaged teas, K-Cup pods, and bottled ready-to-drink teas.

In addition to Tazo, Unilever owns beverage brands Lipton and Brisk, both of which make tea products.

Seattle-based Starbucks recently announced plans to close all of Teavna's 379 retail locations and will instead sell Teavana teas inside its approximate 27 thousand coffee shops.

Under the asset purchase agreement, Unilever will acquire the Tazo brand and all related intellectual property, signature recipes and inventory for $384 million.

"With its strong appeal to millennials, Tazo is a flawless strategic fit for our U.S. portfolio that includes exciting new brands such as Seventh Generation, Dollar Shave Club and Sir Kensington's", said Kees Kruythoff, president of Unilever North America.




On the company's quarterly call, Starbucks said it would launch a co-branded Chase Visa credit card this winter.

The coffee giant cut back its profit forecast on the heels of disappointing fourth quarter sales, which were impacted in part by two back-to-back hurricanes. In the same period a year ago, the company reported EPS of $0.56 on revenues of $5.71 billion. Starbucks said same-store sales would have increased 3 percent without the impact of hurricanes Harvey and Irma. The company also reported narrower operating margins and earnings per share of 54 cents. Its earnings were 55 cents per share, on the nose with analyst projections. Wall Street analysts expected Starbucks to have about $5.81 billion in revenue.

Global comparable sales growth, a key industry metric, came in at 2 percent, driven by a 2 percent gain in the average amount customers were spending and a 1 percent increase in the number of their transactions.

Starbucks also adjusted its long-term annual global same-store sales growth target to 3% to 5%, compared with its previous target of mid-single digit growth.

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