tarbucks said it would look to open more stores in under penetrated markets.
Starbucks Corp on Tuesday issued a statement stating that it will close 150 cafes in some saturated US markets.
The American coffee chain has seen increasing competition from upscale coffee houses and fast-food chains like McDonald's Corp and Dunkin Donuts in recent years, missing analysts' estimates for same-store sales in the US-dominated Americas region in five of the last six quarters.
According to Starbucks it expects global comparable store sales to rise 1 percent in the third quarter, below the 3 percent increase estimated by analysts.
The company anticipates lower net new store growth in the United States for fiscal 2019 is planning to address rapidly changing consumer preferences by introducing new beverages, focusing on growing health and wellness trends.
"While certain demand headwinds are transitory, and some of our cost increases are appropriate investments for the future, our recent performance does not reflect the potential of our exceptional brand and is not acceptable," Starbucks Chief Executive Officer Kevin Johnson said in a statement.
Starbucks said it would look to open more stores in under penetrated markets and explore strategic options to license company-operated stores. China is the company's biggest growth driver with same-store sales rising 4 percent in the last reported quarter.
The company also said it would look to cut general and administrative expenses with plans to partner with an external consultant to speed up the process.