Dunkin' Sales Disappoint as Same-Store Sales Drag

2 min read

Dunkin' Brands' quarterly report wasn't as sweet as the donut giant expected.

The company today posted second-quarter sales that fell short of expectations due to weak same-store sales at Dunkin' Donuts in the U.S. and Baskin-Robbins' struggles abroad. It also cut its full-year forecast in a sign that more weakness is to come.

Dunkin' Brands reported a second-quarter profit of 47 cents a share, in line with analysts' estimates. Revenue for the quarter rose to $190.9 million from $182.5 million a year ago, but missed the $198.5 million analysts were expecting.

Related: Dunkin' Donuts Franchisees Forced to Raise Coffee Prices

Same-store sales at U.S. Dunkin Donuts rose only 1.8 percent, compared to 4 percent in the same period last year, with the company attributing the slower growth to "macroeconomic challenges" across the retail and fast-food industries as well as a cold and rainy spring. Dunkin' Donuts American market makes up around 75 percent of the company's total revenue.

Baskin-Robbins was also to blame for the weak quarter. The chain, which has thrived internationally despite the fact that there are only a handful of stores open in the U.S., failed to reach its anticipated profit this quarter. The Baskin-Robbins joint venture in Japan didn't perform as well as expected, says Dunkin's CFO Paul Carbone, and overall ice cream profits were down for Baskin-Robbins International.

While Dunkin' Brands still expects Baskin-Robbins to achieve full-year same-store sales to grow 1 to 3 percent, it now expects same-store sales at U.S. Dunkin' Donuts to grow 2 to 3 percent for the year, down from an earlier forecast of 3 to 4 percent. The company also lowered its full-year profit and revenue targets.

Related: How Baskin-Robbins Is Trying Not to Disappear

More from Entrepreneur
Entrepreneur Select: A Fund For Entrepreneurs, By Entrepreneurs

Entrepreneurs require more than just money, which is why we aim to empower you, as well as act as a catalyst for value creation.

Discover the franchise that’s right for you by answering some quick questions about
  • Which industry you’re interested in
  • Why you want to buy a franchise
  • What your financial needs are
  • Where you’re located
  • And more
Make sure you’re covered for physical injuries or property damage at work by
  • Providing us with basic information about your business
  • Verifying details about your business with one of our specialists
  • Speaking with an agent who is specifically suited to insure your business

Latest on Entrepreneur