Howard Schultz Urges Starbucks Revival Amid Dismal Earnings
Former Starbucks CEO Howard Schultz, though having departed the coffee giant several months ago, continues to offer insights and critiques regarding the company he led for approximately 25 years over three tenures.
In response to Starbucks’ disappointing earnings report, Schultz took to his LinkedIn account to address concerns about the chain’s US operations, which he believes are the primary factor behind its recent challenges. He emphasized the importance of executives spending more time with cafe employees to enhance the customer experience.
Schultz advocated for a revitalization of the company’s mobile ordering and payment app, urging Starbucks to recapture its original uplifting essence. He also suggested a renewed focus on coffee-centric innovation to differentiate Starbucks in the market and reinforce its premium position.
While Schultz stepped down from Starbucks’ board of directors last September and formally exited as CEO in March 2023, he remains one of the company’s largest shareholders.
The current CEO, Laxman Narasimhan, acknowledged a disappointing quarter in Starbucks’ second-quarter earnings, marked by a decline in same-store sales, particularly in the US and China, Starbucks’ second-largest market.
Shares of Starbucks have declined over 20% for the year, prompting Narasimhan to pledge a turnaround strategy focused on app updates, service enhancements, and menu innovations to reignite customer interest.
Schultz, reflecting on his tenure, acknowledged past financial disappointments and stressed the need for contrition and renewed focus on core values to recover from setbacks. Despite the challenges, he expressed confidence in Starbucks’ resilience and its ability to navigate the current difficulties.
Notably absent from Schultz’s remarks were references to ongoing negotiations with the Starbucks workers union or the company’s legal dispute with the National Labor Relations Board, underscoring his focus on operational and strategic matters.
