Starbucks Korea Posts First Loss in 27 Years After Boycott

Earnings
โดย Bloomberg·KRUS·Read original
Summary · why it matters

Starbucks Korea posted its first quarterly operating loss since it started operations 27 years ago after a marketing debacle triggered a boycott, criticism from President Lee Jae Myung, and a police raid of its corporate offices. SCK Company Co., which operates Starbucks in Korea, recorded an operating loss of 18.4 billion won ($12.9 million) in the three months through June, compared with an operating profit of 40.3 billion won a year earlier, according to a statement Thursday. Net sales fell 6.1% to 747.3 billion won from a year ago, even as the company added 49 more stores in the quarter in South Korea, which is their largest market outside the US and China. The company unleashed public anger with a "Tank Day" promotion in May, offering discounts on large "Tank" tumblers on the anniversary of South Korea's 1980 Gwangju uprising, when troops and tanks were deployed to suppress pro-democracy protesters. US-based Starbucks Corp. issued a statement calling the campaign "unacceptable," Starbucks Korea's chief executive was dismissed, and Shinsegae Group Chairman Chung Yong-jin bowed repeatedly during a televised apology and took responsibility for the episode.

Impact on stocks 2

Consumer Discretionary▼ · 2 stocks
Starbucks Corporation
SBUX
▼ NegativeDemandrelevance

Boycott in key market leads to first loss for Starbucks Korea, impacting parent's operations.

Shinsegae
004170
▼ NegativeRegulationrelevance

Shinsegae chairman apologizes and takes responsibility for marketing debacle, facing reputational and legal fallout.

Off-coverage companies 1

Starbucks KoreaPrivate▼ Negative
Demandrelevance

Starbucks Korea posts first operating loss due to boycott and criticism, with sales falling 6.1%.

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