Starbucks is firing 1,100 corporate employees, its chief executive said in a letter to workers on Monday, stating the latest move from the coffee chain to rebuild amidst inadequate sales. It is shown.
Brian Nickol, who took over as CEO last fall, vowed to seduce customers who have been away from the $8 latte and long waits. The company's first quarter of fiscal year 2025 saw a 4% drop in sales from the same store. This ended on December 29th. The layoffs are intended to allow Starbucks to “operate more efficiently” and “operate more efficiently.” Reduces complexity. ”
The cuts affect almost 7% of the 16,000 employees of the company working in company-owned stores. Barista is not included. Starbucks had indicated it plans to cut down on corporate jobs in January.
“We believe this is a necessary change to position Starbucks for future success,” Nicole said in his memo. The company will also scrap hundreds of open, unopened positions, he said.
Starbucks stocks rose more than 1% on Monday morning.
The move comes in Nicole's efforts, part of his pledge to rethink customer's in-store experiences and regain the more personal coffee house vibe that Starbucks was originally known. He sought changes to the mobile ordering system to deal with the surge in orders and cut some items from the menu. The company also announced that it will not raise prices for fiscal year 2025.
Last month, Nicole shook the chain's leadership in North America, a market that accounts for about three-quarters of revenue. Mike Grams, formerly president and chief operating officer of Taco Bell, and Meredith Sandland, chief executive of restaurant software company Empower Delivery, have two companies that oversee the performance, development and design of the store. He was appointed to a new role.
“We're on track to turn our business around,” Nicole told Wall Street analysts and investors in a revenue call last month since joining the company in September. “But much of our work has just begun.”
Nicole was one of the highest-paid corporate executives last year. Starbucks awarded Niccol $96 million in 2024, supplementing what it earned when he stayed at Chipotle, formerly CEO for six years.
Nicole also secured commuting perks. Starbucks has agreed to use corporate planes to fly 1,000 miles from their home in Newport Beach, California, from their home to their headquarters in Seattle. Nicole said Monday that Starbucks will begin requiring employees above the Vice President's level to work three days a week from their offices in Seattle or Toronto.
Most Starbucks employees work in stores run by the company. Nicole became CEO of Union Drive between US baristas that began in 2021. Over 500, or about 5% of the US locations owned by the company, are organized. The company and workers, a union representing thousands of Starbucks workers, agreed last month to introduce mediators to revive contract talks.
“It's clearer than ever that baristas are at the heart of Starbucks' turn,” said Michelle Eisen, a longtime Starbucks barista who led the organizing campaign.
