Starbucks Says Profit Won’t Meet Projections

Starbucks Corp., the largest coffee retailer in North America, said its profit this year will fall short of analysts’ expectations because of costs associated with its expansion on the Internet. The Seattle-based company said it expects a profit of 54 cents a share for its fiscal year ending in September; the average estimate of analysts polled by First Call Corp. had been 60 cents. Its stock, which closed at $37.56 on Nasdaq on Wednesday, fell as low as $28 after the announcement. Chairman Howard Schultz is investing in online companies to capitalize on the rapidly growing market and to expand Starbucks’ visibility and access to Internet commerce. The retailer last month led a $20-million investment in online chat-room developer Talk City Inc., the first of several expected Internet moves. The six-cent difference between the company’s latest forecast and analysts’ estimates will be evenly split between the last two quarters of the year, the company said. Starbucks said sales at stores open at least a year rose 7% last month, and that revenue last month rose 30% to $170 million from $131 million a year ago.