Why did Starbucks lose $12 billion?
Over the past month, Starbucks’ market cap has plunged some $12 billion after a walkout on its all-important Red Cup Day and a public spat over the Israel-Hamas war with the union representing its baristas. Starbucks annual gross profit for 2024 was $24. B, a 1. Starbucks annual gross profit for 2023 was $24. B, a 12. Starbucks annual gross profit for 2022 was $21. B, a 7.The company reportedly lost $11 billion in market value partially as a result of the boycotts from November to December 2023.Starbucks 2024 year-end results didn’t help. While it reported basically flat revenues at $36.This led to widespread calls for boycotts, amplified by social media campaigns and on-the-ground protests. The financial repercussions were significant: Starbucks experienced a sharp decline in market value losing approximately $11 billion in value, erasing 9.
Is Starbucks in danger of closing?
In the statement released last week, the CEO added that Starbucks has opened numerous coffeehouses over the past year and the overall company-operated count in North America will decline by about 1% in fiscal year 2025 after accounting for both openings and closures. Starbucks, Luckin Coffee and Dunkin’ are the three largest coffee companies in the world, respectively. The largest coffee houses typically have substantial supply-chain relations with the world’s major coffee-producing countries.Globally, Starbucks faces significant challenges, particularly in China, where its ambitious 2022 expansion plan to open one store every nine hours has faltered under intense competition from local rival Luckin Coffee, which now ranks 19th among the world’s most valuable restaurant.Key competitors include Dunkin’ Donuts and McDonald’s. Starbucks also faces competition when it comes to coffee products available for purchase outside of brick-and-mortar cafes from brands like Nespresso, Folgers, Keurig, and Maxwell House.Starbucks, Luckin Coffee and Dunkin’ are the three largest coffee companies in the world, respectively.
Why is Starbucks suddenly struggling?
Starbucks’ closures were driven by consumers who moved away from urban centers during the Covid-19 pandemic, said RJ Hottovy, an analyst at Placer. The chain is now shedding leases in areas that have notably less business. Starbucks announced a $1 billion restructuring plan Thursday that involves closing some of its North American coffeehouses and laying off more workers. Approximately 900 non-retail employees will be laid off, Starbucks said.Starbucks has confirmed the removal of thirteen drinks from its menu on March 4th, 2025. The news came from the brand’s CEO Brian Niccol amongst a broader plan to shrink its menu 30% by the end of this year. Amongst the cuts are a variety of drinks, the majority of them Frappuccinos.The layoffs and closures announced in September 2025 are the direct result of consumers standing with Palestine and choosing justice over convenience. Starbucks is closing stores. Workers are being laid off. The boycott is working.New corporate layoffs are a second wave after Starbucks cut 1,100 jobs in February. CEO Brian Niccol has said the cost cuts were needed to redirect more money toward stores, where the company is adding more baristas, speeding up service and upgrading the ambiance.
Who is Starbucks owned by?
Starbucks is owned by its shareholders, as it is a publicly-traded company. The company has more than 1,500 institutional shareholders, according to the proxy statement that Starbucks filed with the SEC on January 7, 2022. As of November 2022, the company had 35,711 stores in 80 countries, 15,873 of which were located in the United States. Of Starbucks’ U. S. It is the world’s largest coffeehouse chain.Starbucks is a bigger company in terms of market capitalization and the number of stores globally. Starbucks has also built a more premium brand, has stores that look more like a comfortable coffee house, has a more extensive menu, and greater product customization.Starbucks uses the 4 P’s of marketing – product, place, promotion, and price. For product, Starbucks focuses on high quality coffee and customization. For place, Starbucks locations include cafes, retailers, and mobile apps.New CEO Brian Niccol really wants the brand to appear more like a “community coffeehouse. Starbucks wants to put its “coffee” front and center. On Jan. The Starbucks Coffee Company. The name appears in a new TV commercial, as well as its website and app.
Why boycott Starbucks in 2025?
Activists from the Palestinian solidarity movement have mobilized against Starbucks due to its support for Israel since 2023. This led to widespread calls for boycotts, amplified by social media campaigns and on-the-ground protests. After issuing Palestinian support and solidarity and condemning Israel, a global boycott began, in addition to a pause in hosting Pride decorations in stores. For several months, Starbucks has been subjected to lawsuits for policy changes against workers and customers of the Black and LGBTQ+ community.Starbucks’ new water policy restricts free water to paying customers. However, baristas may still give non-paying customers water if they are not overly busy.The new rules are part of a larger effort to improve Starbucks’ cafe experience and deter homeless people and non-paying customers who have come to use Starbucks solely for shelter and bathroom access – but they reverse a policy that was put in place after one of the company’s biggest-ever PR disasters.