What happened

Shares of Starbucks (SBUX 0.93%) fell 16.2% in March, according to data provided by S&P Global Market Intelligence, as the coffee giant scrambled to respond to the COVID-19 outbreak in North America.

Like just about every company with a brick-and-mortar retail presence in the United States, Starbucks' shares underperformed the S&P 500 last month. 

SBUX Chart

SBUX data by YCharts.

So what

Starbucks had an eventful month, making moves in North America roughly in step with the evolving response to the novel coronavirus pandemic in the U.S. and Canada. 

Here's a quick recap of how it went:

  • On March 12, CEO Kevin Johnson said that the company would implement protective measures at its stores as necessary, and that it had introduced a new "catastrophe pay" provision to provide extra paid sick leave to employees who were exposed to (or diagnosed with) COVID-19.
  • Two days later, it issued an update: Its stores in the U.S. and Canada moved to a takeout-only (walk-in or drive-thru) model, eliminating all seating inside and outside, to encourage social distancing. 
  • At Starbucks' annual meeting on March 18, held online, Johnson said that 90% of its stores in China had reopened as the coronavirus outbreak subsided, that it will roll out a new delivery initiative with Uber Technologies' (UBER -2.95%) Uber Eats by the end of April, and that Starbucks would step up its share-repurchase plans. Shares fell on the news, but bounced back the next day.
  • On March 22, the company extended its "catastrophe pay" program to provide time off with pay for any employee who chose to stay home during the virus outbreak, and to give employees who do choose to work as scheduled during that period an extra $3 per hour in "service pay." Shares fell. 
  • On March 24, shares jumped after Johnson told CNBC that Starbucks' balance sheet remained strong, that it was applying lessons learned from China to its stores in the U.S. and Canada, and that many of its China stores had already reopened. 
A Starbucks coffee cup, with the company's green logo visible.

Image source: Starbucks.

Now what

Since the end of March, Starbucks has said that it will maintain its takeout-only policy in the U.S. and Canada through at least May 3, and that its employees in those regions will begin wearing masks at work. 

It's still too early to tell how hard the pandemic will hit Starbucks' top and bottom lines. But investors can take heart: The company is still generating some revenue from its somewhat-open stores, and it has more than ample liquidity to ride out the crisis.