Starbucks CEO lays out long-term growth plan, aims to open thousands of new stores

Starbucks is seeking to return to pre-pandemic profit margins as CEO Brian Niccol’s turnaround campaign is “ahead of schedule,” executives said at the company’s investor day held Thursday, describing a strategy of international growth, new drinks and cheaper but more inviting store renovations.“The shine is back on Starbucks,” Niccol said to an audience of analysts and media gathered at the event on Manhattan’s west side.The investor day is the company’s first since Niccol’s hiring in September 2024, when he suspended financial guidance as he undertook a turnaround campaign called “Back to Starbucks,” focused on overhauling store operations and promoting Starbucks’ public image as a welcoming coffeehouse chain.On Wednesday, the coffee giant reported US sales growth for the first time in two years.The event showcased a floor model of Starbucks’ new store design, featuring leather seating and teak-colored display cabinets.

Starbucks also offered tastings of upcoming menu items, such as a new matcha beverage line, and exhibited new and upcoming in-store technology, such as new espresso-brewing equipment and an A.I.-powered “virtual assistant” for baristas.Starbucks executives said that by fiscal year 2028, the company aimed to achieve an operating margin of up to 15%, marking a recovery after Niccol’s hefty investments in additional staffing.Executives also said the company would seek to achieve annual earnings per share of $3.35 to $4.Starbucks’ shares fell about 1.5% on Thursday after the much-awaited long-term targets were announced.

Lauren Silberman, an analyst with Deutsche Bank, said the range in the earnings guidance was “too wide,” during the event’s questions portion.“It’s been around 15 months since the CEO took the helm of the ship and turning the ship around may be taking longer than originally hoped.There are incremental improvements, but the stock price is about where it was when he became CEO,” said Br...