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Starbucks CEO Announces Turnaround Plan After Earnings Drop
Starbucks released its financial results early, revealing a decline in sales. The company’s performance in key markets, the US and China, has been underwhelming.
CEO Brian Niccol acknowledged that Starbucks has lost its focus and plans to implement a comprehensive turnaround strategy. He cited customer feedback indicating a decline in visits due to factors such as a complex menu and long wait times.
Niccol plans to address staffing issues, simplify operations, and improve the mobile ordering system. He also emphasized the importance of catering to all customers, not just rewards program members.
Starbucks has suspended its fiscal 2025 guidance to assess its business and finalize its turnaround plans. Despite the challenges, the company increased its dividend as a sign of confidence.
Shares declined after the earnings announcement, reflecting investor concerns about the turnaround process. Niccol is expected to provide further details about his plans for the company in an upcoming call.