Starbucks to shutter all of its Teavana stores

NEW YORK — Starbucks is shutting down its struggling Teavana chain and relying on customers who spend more on pricier drinks and food to drive up sales at its namesake coffee stores.

The company reported disappointing global sales growth Thursday and said it will close all 379 Teavana locations over the coming year. It had acquired the U.S. mallbased chain — founded in Atlanta in 1997 — in 2012, with then-CEO Howard Schultz citing the huge potential for the tea market. But in April, the company said it was reviewing options for the chain.

Starbucks CEO Kevin Johnson on Thursday noted declining foot traffic at malls.

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

The 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. In the U.S., sales rose 5 percent at established locations, also driven mostly by higher spending versus an increase in customer visits.

For the quarter, Starbucks Corp. earned $691.6 million, or 47 cents per share. Excluding one-time items, it earned 55 cents per share, in line with Wall Street expectations. New store openings helped lift revenue 8 percent to $5.66 billion. But that was still less than analysts expected.

The company trimmed its adjusted earnings per share forecast to between $2.05 and $2.06 per share. Starbucks shares fell 5.6 percent to $56.15 in extended trading.