Starbucks CEO pledges to fundamentally change strategy as sales fall for third straight quarter

Starbucks on Wednesday reported quarterly earnings and revenue that missed analysts' expectations as sales in the U.S. and China, its two biggest markets, disappointed.

The company previously released a preliminary report of its quarterly results on Oct. 22 and announced it was suspending its fiscal 2025 outlook. 

This report marks the first under CEO Brian Niccol, who joined the company on Sept. 9 to revive the floundering business. 

"It is clear we need to fundamentally change our strategy to win back customers," CEO Brian Niccol said in a statement. "We have a clear plan and are moving quickly to return Starbucks to growth."

Niccol outlined a multipart plan to improve the company's U.S. business immediately.Many of the steps address a new goal for Starbucks: hand delivering a customer's drink in under four minutes. Roughly half of current transactions are within that threshold, according to Niccol.

Cafes will bring back the condiment bars that disappeared behind counters during the pandemic, get rid of extra charges for milk alternatives and cut back menus. Niccol also told investors that he wants to bring "order to mobile order and pay" and improve restaurant staffing.

"I'm very optimistic, despite the near-term challenges," Niccol said. "I believe we have significant strengths, a strong, enduring brand. We have a clear plan. We're going to be moving quickly."

For now, the strategy is focused on North America. Niccol said he'd need to spend time in China to better understand the company's operations and the market beforedecidinghow to revive sales there.

In fiscal year 2025, Starbucks also plans to cut back on new cafes and renovations. CFO Rachel Ruggeri said the shift is to "accommodate a redesign" across its locationsand