The preliminary results, released ahead of schedule, mark the first under new CEO Brian Niccol, who joined the coffee chain last month. Global comparable store sales decreased by 7% year-on-year in Q4. Net revenues fell by 3% to $9.1 billion in the three months ending in September, with sales down 25% year-over-year on a per-share basis.
The company announced that guidance for the full fiscal year 2025 would be suspended due to the CEO transition and the current business situation. Poor sales at Starbucks have been attributed to consumers moving away from high-priced drinks and long queues during peak times.
Former CEO Laxman Narasimhan was dismissed in August, and Niccol, known for turning around the burrito chain Chipotle, was appointed. He aims to restore the warm atmosphere characteristic of Starbucks’ early days, prioritizing enhancements at US locations.
In a video released on October 22, Niccol emphasized the need for a fundamental shift in strategy to achieve growth, outlining plans to simplify the “overly complex” menu, improve pricing structures, and refine the mobile ordering and payment system to enhance the café experience.
“We need to focus on what has always set us apart — a welcoming coffee house where people gather and where we serve the finest coffee, handcrafted by our skilled baristas,” he stated.
The complete results are scheduled for release on October 30. Shares in Starbucks have decreased by 3.6% in after-hours trading.
