Saturday, July 19, 2025

Coffee Crisis: Starbucks Sees Global Sales Dip Amidst Controversy

Newsis

World-renowned coffee chain Starbucks is facing a tough time. The reason is that more consumers are tightening their belts due to rising prices.

Global Sales Down 1.8% Since the Beginning of 2024

According to the BBC, on June 9, Starbucks’ global sales decreased by 1.8% compared to the same period in 2023 since the beginning of 2024.

For the past year, Starbucks’ largest market in the United States has decreased by 3%. This is the most significant decrease since the 2009 financial crisis and the COVID-19 pandemic.

Considered the most loyal customers, Starbucks Rewards Members also decreased by 4% compared to the previous quarter.

Starbucks Hit Hard by Boycott Movement in Israel

Starbucks was hit hard by a boycott movement when allegations spread that it supported Israel during the Gaza war that broke out in October 2023 and funded the Israeli government and military.

At the time, Starbucks sued the union for damaging its reputation after customers protested posts supporting Palestine on social media.

Starbucks explained that it became the target of a boycott movement due to misunderstandings.

In a recent conference call, Starbucks CEO Laxman Narasimhan said, “Incorrect information from the Middle Eastern region affected sales.”

Sara Senatore, an analyst at Bank of America, gave her two cents regarding the decrease in Starbucks’ sales. She stated, “Starbucks’ price increase was not significantly noticeable compared to competitors,” adding, “It is insufficient to explain the recent sales decline by other factors excluding the boycott movement.”

Meanwhile, Narasimhan said he would take aggressive marketing steps, such as launching new menus, but Starbucks CFO Rachel Ruggeri said, “It will take some time.”

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