The new CEO of Starbucks, Brian Nicolmade news for him work from home setup and early priority list. However, after Starbucks surprised investors and analysts with its preliminary earnings report Tuesday eveningprivate jet travel may be the least of Nikola's worries.
Starbucks revealed a decline in sales in the US and China that led to a year-over-year sales decline for the third straight quarter ended September 29. Now, the company will suspend its financial guidance for the rest of the year, Starbucks announced through a press release.
“Despite our increased investment, we were unable to reverse the trajectory of declining traffic, resulting in pressures on both our top line and our bottom line,” said Starbucks Chief Financial Officer Rachel Ruggeri. on release.
Nicole said that the report “makes it clear” that the company must “fundamentally change our strategy so that we can return to growth.”
“People love Starbucks, but I've heard from some customers that we've gotten away from our core, that we've made it harder to be a customer than it needs to be, and that we've cut off communication with them,” Niccol. said in a video message. “As a result, some are visiting less frequently, and I think today's results tell the same story.”
Niccol left his role as chief executive at Chipotle to join the coffee chain and will they are said to win over $113 million in his first year, including bonuses and stock incentives.
Photo by Muhammet Zeyd Karaaslan/Anadolu via Getty Images
Nicol also noted that the immediate changes were being developedincluding simplifying our “overly complex menu” and adjusting our “pricing architecture.” The company has already changed some of its marketing to be TikTok-friendly ASMR ads featuring coffee making sounds.
“Starbucks has always been a place where people come together,” Niccol said. “We're reviewing our stores to make sure we're offering the amenities you'd expect in a community cafe.”
Starbucks' full earnings report will be released on October 30.