Starbucks had a strong holiday season in the U.S. but weaker sales in China as its ended the second year of the pandemic.

U.S. same-store sales, or sales at stores open at least a year, were up 18% over the October-December period a year ago. The Seattle-based coffee giant said more U.S. customers were visiting at all times of the day and spending more per visit.

But same-store sales in China fell 14%, partly due to continuing lockdowns.


Starbucks revenue rose 19% to $8.1 billion in its fiscal first quarter. That was ahead of Wall Streets forecast for revenue of $7.89 billion, according to analysts polled by FactSet. Overall same-store sales growth of 13% was in line with expectations.

But Starbucks fell short of earnings forecasts, and said inflation, continuing pandemic-related costs and rising labor costs were a contributor.

In October, the company said it was raising workers’ pay to ensure a steady workforce amid labor shortages. The company said all of its U.S. workers will earn at least $15 and up to $23 per hour by this summer. Workers can also get a $200 recruitment bonus to help attract new employees.

But the announcement didn’t pacify some workers, who are calling for more say in the way the company’s stores are run. Two Starbucks stores in Buffalo, New York, recently became the first Starbucks stores to unionize in decades, setting off a wave of union activity at other stores across the country. As of this week, 54 stores in 19 states have filed for union elections, according to Workers United, the union organizing the effort.

The company reported adjusted earnings of 72 cents per share, lower than the 80 cents analysts were forecasting.

Starbucks shares fell 5% in after-hours trading.