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Starbucks’ earnings came under pressure during the holiday quarter due to rising costs and renewed Covid-19 lockdown measures that hurt sales in China.

The coffee chain noted comparable sales growth of 13 percent year-on-year in the quarter ending Jan. 2, driven by the U.S. restaurant boom and higher menu prices.

But comparable sales fell by 14 percent in China, where some cities have imposed new pandemic restrictions on food service and other activity. Sales fell 3 percent across the company’s international markets, which fell short of analysts’ forecast of a 0.5 percent increase.

Starbucks also lacked adjusted earnings estimates of 72 cents per share. per share, which was 8 cents below Wall Street’s forecast, as wage and commodity inflation contributed to higher operating costs.

Its shares lost 4.6 percent in aftermarket on Tuesday.

Restaurant chains are struggling with higher supply chain costs and a shortage of unemployed workers at a time when many consumers are eager to get back to eating out after Covid-19 vaccinations. The rise in Covid infections over the winter and related quarantine rules contributed to staffing challenges, even as companies raise wages to attract new workers.

Kevin Johnson, Starbucks’ CEO, said that although customer demand was strong, the company experienced “higher-than-expected inflationary pressures”, as well as a tight labor market and increased costs related to the Omicron-driven resurgence in Covid cases.

Net revenue increased 19 percent to 8.1 billion. USD collected in the first accounting quarter. Net income rose to $ 816mn, up from $ 622mn a year ago.

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