Shares of Luckin Coffee (NASDAQ: LK) have plunged today, down by 16% as of noon EDT, after the freshly public Chinese coffee chain reported second-quarter earnings. The results missed analyst expectations.
Total revenue in the second quarter came in at 909.1 million yuan ($132.4 million), shy of the 940.3 million yuan that analysts were expecting. That all translated into an adjusted net loss of 610.8 million yuan ($89 million), or 3.28 yuan ($0.48) per American depository share (ADS). Consensus estimates had called for an adjusted loss of 3.07 yuan per share.
Luckin Coffee has dramatically expanded its retail footprint, more than quadrupling total stores over the past year to nearly 3,000 locations. Average monthly transacting customers surged to 6.2 million, up from 1.2 million a year ago. Store-level operating loss was 55.8 million yuan ($8.1 million) during the quarter. Luckin also established a joint venture in late July with Kuwait Food Company Americana to expand into the Middle East and India.
"Total net revenues from products sold increased 698.4% year-over-year, driven by a significant increase in transacting customers, an increase in the average number of items purchased by our transacting customers and higher effective selling prices," CEO Jenny Zhiya Qian said in a statement. "We believe this is the result of our distinguished value proposition of delivering our customers high quality, high convenience and high affordability."
In terms of guidance, Luckin expects third-quarter net product revenue to be in the range of 1.35 billion yuan to 1.45 billion yuan ($192.2 million to $206.4 million based on current exchange rates).
This article was originally published on Fool.com