About This Source - CGTN
This story is an English language news item from CGTN. CGTN is a Chinese state-funded broadcaster. More from CGTN
There’s trouble brewing at Luckin Coffee. Luckin’s stock plunged over 80 percent on Thursday after it disclosed that its chief operating officer inflated 2019 sales by about 310 million U.S. dollars. The U.S.-listed coffee chain suspended its COO and several other employees, adding that an internal investigation was at a preliminary stage. It said that investors shouldn’t rely on previous financial statements. China’s securities regulator has responded. The CSRC said it strongly condemns Luckin’s financial misconduct and says it will investigate the issue according to the law and will crack down on fraudulent activities. The company has long been seen as Starbucks’ challenger in China but has yet to turn a profit since its IPO last year. Luckin’s stores outnumbered Starbucks by the end of last year.
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