To stay relevant today, a coffee shop has to be much more than just a place to grab a basic cup of black coffee. With the explosion of café culture and remote work, customers now expect a variety of food options, trendy seasonal drinks, and—just as crucially—fast, reliable WiFi.
During Starbucks’ latest earnings call, CEO Brian Niccol spoke about the company’s efforts to recapture its appeal and reconnect with customers. “We’re going to, once again, be loved for our coffee, loved for the warmth, loved for the welcoming coffeehouse… that we have,” he said. The brand is betting on cozy, inviting spaces and picture-perfect latte art to bring back that classic café experience.
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One major focus of the call was menu simplification—trimming down food and drink offerings while improving how they’re presented on in-store digital displays. With a planned 30% reduction in menu options, Niccol explained that the new digital boards will make it easier to highlight different drinks and food items depending on the time of day, all while reinforcing the coffeehouse vibe and making the menu more intuitive for customers.
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Starbucks is also making a concerted push to attract more Gen Z consumers. Along with the updated menu displays, Niccol highlighted moves like eliminating extra charges for non-dairy milk and expanding the selection of cold drinks—especially teas, refreshers, iced coffees, and cold brews. “If we bring smart flavors with tea, refreshers, cold beverages… we continue to see progress with the younger customers,” he noted.
Here are some key takeaways from the call, followed by the full earnings transcript:
Q1 revenue remained flat at $9.4 billion
The company is shifting strategy to address underlying challenges and build long-term growth
Plans to double U.S. store count
Major investments in employees, including a new scheduling system, increased paid parental leave, and a commitment to promoting 90% of retail leadership from within