The glass is looking half empty for Starbucks (SBUX) this quarter.

For its second quarter earnings, the company missed expectations across the board, posting lower-than-expected revenue, earnings, and same-store sales growth, as customers pulled back on the frequency of their visits and the size of their orders.

Its shares opened 14% lower on Wednesday; it reported results after market close on Tuesday.

CEO Laxman Narasimhan called it a "a highly challenged environment."

During the earnings call, he added that macro headwinds, "particularly around the pressures that consumers face, particularly with the occasional customer, ... that's where the challenge is."

This is Starbucks' first quarterly sales decline since 2020, when COVID shutdowns roiled the industry.

Revenue for the second quarter dropped 2% year over year to $8.6 billion. Adjusted earnings per share also came in lower, down 8% to $0.68.

Global same-store sales declined 4% from a year ago as transactions dropped 6%, which was partially offset by a 2% increase in average ticket size.

Starbucks attempted to lure in customers with afternoon promotions and new offerings like lavender lattes, which Narasimhan said "performed nearly as well this past quarter as the PSL [pumpkin spice latte]."

However, menu innovations didn't appear to move the needle for the coffee giant.

In its North America and US business, same-store sales declined 3%, with foot traffic dropping 7% year over year, though ticket size was up 4%.

To attract the occasional customers, Starbucks plans to add new promotions to its app. In the US, 31% of all Q2 transactions came through its app. However, the number of 90-day active loyalty members declined to 32.8 million, compared to 34.3 million last quarter.

Narasimhan also called out the speed of service as an area of opportunity. Currently, many customers don't complete their app orders due to long wait times or lack of product availability. The company is "ramping up supply chain investments to further improve availability," he said.

New products, such as boba tea-like pearls, zero to low-calorie energy drinks, and more sugar-free syrups, are also on tap.

For its international business, same-store sales were down 6%, with a 3% decline in foot traffic and ticket size. Similar to McDonald's (MCD), Starbucks said the conflict in the Middle East weighed on international sales.

Narasimhan shared his concerns about current events and misinformation being spread about the company in an internal memo in mid-December.