Progress on “Back to Starbucks” Strategy Driving Confidence in Turnaround.
SEATTLE – Starbucks Corporation (Nasdaq: SBUX) today reported financial results for its 13-week fiscal second quarter ended March 30, 2025. GAAP results in fiscal 2025 include items that are excluded from non-GAAP results. Please refer to the reconciliation of GAAP measures to non-GAAP measures at the end of this release for more information.
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- “My optimism has turned into confidence that our ‘Back to Starbucks’ plan is the right strategy to turn the business around and to unlock opportunities ahead,” commented Brian Niccol, chairman and chief executive officer. “Improving transaction comp in a tough consumer environment at our scale is a testament to the power of our brand and partners getting ‘Back to Starbucks.’ We are on track and if anything, I see more opportunity than I imagined,” Niccol added.
- “While our financial results are far from Starbucks potential, we are working to build back a better business,” commented Cathy Smith, chief financial officer. “We are developing new muscles to test, iterate and scale quickly, in service of long-term, durable growth and strong returns on invested capital,” Smith added.
Q2 FY25 Earnings Video Transcript
Brian Niccol, chairman and ceo
Hey, there. I’m Brian Niccol.
Seven months ago, we launched our ‘Back to Starbucks’ strategy.
Since then, we’ve learned a lot, and we’re moving quickly to drive meaningful change. We are putting the customer back at the center of all we do, delivering exceptional green apron service and creating inviting coffeehouses where customers want to spend time and build community.
My initial optimism has turned to clear confidence. We are where we should be at this point in our turnaround.
We’ve got the right team in place to lead. We’re setting our green apron partners up for success with the best job in retail. We’re confident we have the right strategy, and we are making the right disciplined investments to unlock opportunities ahead.
I’ve led turnarounds before. And I know, from experience, that when you focus relentlessly on the customer, you take care of your people, you execute consistently, and you carefully manage costs, the results will follow.
Our financial results don’t yet reflect our progress, but we have real momentum with our “Back to Starbucks” plan. We’re testing and learning at speed and we’re seeing changes in our coffeehouses. As we scale these changes across our full footprint — combined with the continuing strength of the Starbucks brand — we know we will return the business to growth. We’re not just building back our business. We’re building back a better business.
Let me share some of the changes we’re driving:
- Our partners are leading a green wave of hospitality, with the customers at the center of all we do.
- We’re creating moments of connection with customers and giving them a reason to sit and stay.
- We’re improving speed-of-service, throughput and connection with the right staffing and deployment.
- Our new marketing is resonating with customers.
- And eight of our top ten international markets are now back to flat or positive comparable sales growth.
This progress is a testament to the power of the Starbucks brand and our green apron partners who are leading our comeback.
In the months ahead, we’ll be:
- Improving our coffeehouses with great seats and premium touches so they’re more inviting places for our customers to sit and stay. And we’ll do it while keeping renovation costs down and minimizing closure days.
- We’ll be launching a new green apron service model, combining standards and expectations, staffing and deployment, simplified routines and our order sequencing algorithm. This will improve throughput, deliver a better customer experience and grow transactions.
- And we’ll be overhauling our product innovation pipeline to build a culturally relevant menu that resonates with customers and creates opportunities for new occasions.
Some of the investments we’re making now will take some time to create material returns. And some elements of our plan will move faster than others. We have a lot of work ahead, but we are on the right track and moving quickly.
Thanks again to our partners for supporting the changes we’re making and for the feedback you continue to provide. You’re on the leading edge of our turnaround, and I hope our work makes you proud to wear the green apron.
On we go.
