Starbucks to Lay Off Corporate Employees in Effort to Boost Profitability

Starbucks is preparing to reduce its corporate workforce as part of its ongoing efforts to boost sales and improve profitability. CEO Brian Niccol shared the news in a message to employees and on the company’s website, emphasizing the need for greater efficiency while maintaining the company’s focus on enhancing in-store experiences.

In his announcement, Niccol explained that while the company’s “Back to Starbucks” strategy aims to improve the customer experience in its cafés, the need to streamline operations will result in layoffs among corporate staff.

“We have recently begun the work to define the support organization for the future. We are approaching this work thoughtfully, but it will involve difficult decisions and choices. I expect that, unfortunately, we will have job eliminations and smaller support teams moving forward,” Niccol wrote.

He reassured employees that the changes would not impact in-store teams or investments being made to improve store operations. The exact number of job cuts has not been disclosed, but Niccol said the company would communicate updates by early March.

The “Back to Starbucks” strategy, introduced last year, focuses on returning to the elements that originally made the coffee chain a global leader. This includes bringing back condiment bars, serving coffee in ceramic mugs to enhance the coffeehouse aesthetic, and writing customer names on cups using Sharpies.

Additionally, Starbucks is eliminating extra charges for non-dairy milk customizations and has committed to reducing customer wait times to four minutes in its cafés. Over 3,000 stores have already received additional coverage hours to support this initiative.

Niccol, who became CEO in September 2024, has made revitalizing Starbucks’ brand and profitability a priority. The company has faced challenges, including declining store traffic, unionization efforts, and employee strikes at hundreds of locations. Despite these hurdles, Starbucks is moving forward with a series of worker-focused initiatives, including doubling paid parental leave this spring, covering 100% of college tuition through its Starbucks College Achievement Plan, and offering company stock to eligible employees.

“We have much more work to do, but I’m pleased with the progress we’ve made and appreciate how everyone has rallied around the plan,” Niccol wrote.

The company has also made changes to its in-store policies, now limiting restroom access and seating to paying customers in order to prioritize those who want to enjoy its cafés.

Before Niccol took the helm, Starbucks faced disappointing fiscal quarters and increasing pressure from unionization campaigns.