Starbucks is laying off 1,100 corporate employees, its chief executive announced in a letter to workers on Monday. This decision marks the coffee chain’s latest effort to restructure as it faces lackluster sales. Brian Niccol, who became CEO last fall, has committed to winning back customers deterred by high prices and long wait times, which have negatively impacted sales in recent months. Globally, same-store sales fell by 4 percent in the first quarter of the company’s 2025 fiscal year, which concluded on December 29. According to Mr. Niccol, the layoffs aim to make Starbucks “operate more efficiently” and “reduce complexity.”
The layoffs will affect nearly 7 percent of the company’s 16,000 employees who work outside company-owned stores, with baristas excluded from the cuts. Starbucks had previously signaled in January that corporate job reductions were forthcoming. In his letter, Mr. Niccol stated, “We believe it’s a necessary change to position Starbucks for future success.” The company will also eliminate several hundred open and unfilled positions.
Shares of Starbucks rose more than 1 percent on Monday morning. The move aligns with Mr. Niccol’s broader strategy to rethink the in-store customer experience and streamline operations. He aims to restore the personalized coffeehouse atmosphere that originally defined Starbucks. Among the changes, he has called for adjustments to mobile ordering systems to manage order surges and has removed some items from the menu. Additionally, Starbucks announced it would not raise prices during the 2025 fiscal year.
Last month, Mr. Niccol restructured the leadership team in North America, a region responsible for about three-quarters of the company’s revenue. Mike Grams, formerly president and chief operating officer of Taco Bell, and Meredith Sandland, ex-CEO of restaurant software company Empower Delivery, were appointed to newly created roles overseeing store performance, development, and design.
— news from The New York Times