Starbucks CEO Brian Niccol signals optimism about growth but admits challenges ahead. Shares rose after better-than-expected earnings, with Wall Street cautiously optimistic. The company reported improved sales trends in the U.S., focusing on mobile ordering and dairy substitutes to enhance customer experience.
Niccol acknowledged a “definitely in the middle of a turnaround,” though investors remain cautious due to past struggles. Starbucks saw global same-store sales drop 4% in its latest quarter, with declines particularly pronounced in China (-6%). Operating profit margins fell by over 500 basis points, raising concerns about profitability.
Niccol pulled back on sales guidance ahead of a busy fiscal year, signaling a focus on marketing and staff investment. He aims to revitalize stores with improved service and aesthetics, including ceramic coffee cups and streamlined mobile orders.
Despite these initiatives, Wall Street has lowered earnings expectations due to ongoing challenges and rising costs. Analysts note the need for stronger revenue anchors in 2026 without clear growth signals this year.
Brian Sozzi, Yahoo Finance’s Executive Editor, provides insights into Starbucks’ journey as a leader in the coffee and food sectors.
Source: https://finance.yahoo.com/news/starbucks-ceo-says-a-turnaround-is-underway-with-no-timeline-on-the-table-154600970.html