Economy

Starbucks closing all Teavana stores

Starbucks closing all Teavana stores

"We felt it was an appropriate time to take the decision and begin shutting down those stores", he said.

Despite the Teavana closures, Starbucks again said it's expanding rapidly, with plans to add 240,000 jobs globally over the next five years.

The stores had been "strategically underperforming", Starbucks' president and CEO Kevin Johnson said during an earnings call Thursday.

When Starbucks acquired Teavana in 2012, it seemed like a flawless marriage for the king of coffee chains to apply their successful model to the already successful Teavana brand. "As a result, we will be closing all 379 of our Teavana mall stores over the coming year".

While DavidsTea does have mall-based locations, the company doesn't restrict itself like Teavana does. However, most Teavana locations are inside malls, which have seen a notable decline in revenue, occupancy and traffic over the last several years.

More news: Overwhelmed! Microsoft decides to keep MS Paint

The Teavana announcement came as Starbucks said global sales at its flagship chain rose 4 percent at established locations for the quarter ended July 2, fueled by higher average spending per visit.

Still, the Seattle-based company cited pressure in the retail and restaurant sectors that have made it more cautious going into the next quarter.

On Thursday, Starbucks said it shell out $1.3 billion to buy out its joint venture partners in its East China business.

To justify the closure of its stores, Teavana, Starbucks evokes a financial performance below expectations for the company. Famed investor Mark Cuban says it will produce "the world's first trillionaries", but that should still leave plenty of money for regular investors who make the right trades early.


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