Starbucks to slash U.S. store openings

LOS ANGELES (Reuters) - Starbucks Corp said on Wednesday it would slash U.S. coffee store openings through 2011 to cut costs in the face of weak U.S. sales and to focus more on growth abroad.

The company, which warned last week of the worst economic environment in its history, said U.S. customer visits had slowed but estimated growth in international business profit margins over the next few years.

Investors and analysts have been pushing for Starbucks to cut plans for U.S. expansion.

"It's not really surprising that they've slowed their store growth. The fact that they are making plans to slow it is certainly better than what they were telling us before," said John Langston, an analyst at Hodges Capital Management.

On Wednesday, the coffee shop chain posted fiscal second-quarter net income of $108.7 million, or 15 cents per share, compared with $150.8 million, or 19 cents per share, a year earlier.

Results from the most recent quarter included restructuring-related charges of about 3 cents per share.

Prior to its warning last week, analysts had been looking for a second-quarter profit of 21 cents per share. The results matched lowered estimates, according to Reuters Estimates.

Total revenue rose 12 percent to $2.53 billion. The company said revenue was lower than expected due to a mid-single-digit decline in U.S. same-store sales. Starbucks' U.S. stores delivered 77 percent of total revenue and experienced slower traffic during the quarter.

"Our financial results are clearly being impacted by reduced frequency (of visits) to our U.S. stores," Chief Executive Howard Schultz said in a statement.