Starbucks is laying off 1,100 corporate employees, its chief executive said in a letter to workers on Monday, marking the coffee chain’s latest move to restructure amid lackluster sales.
Brian Niccol, who took over as chief executive last fall, has vowed to woo back customers who have shied away from $8 lattes and long wait times, which have put pressure on sales in recent months. Same-store sales globally slipped 4 percent in the first quarter of the company’s 2025 fiscal year, which ended on Dec. 29. The layoffs, Mr. Niccol said in the letter, are aimed at allowing Starbucks to “operate more efficiently” and “reduce complexity.”
The cuts will affect nearly 7 percent of the company’s 16,000 employees who work outside company-owned stores; baristas are not included. Starbucks had indicated in January that it planned to cut corporate jobs.
“We believe it’s a necessary change to position Starbucks for future success,” Mr. Niccol said in his note. The company, he said, will also scrap several hundred open and unfilled positions.
Shares of Starbucks rose more than 1 percent on Monday morning.
The move comes amid Mr. Niccol’s efforts to rethink the in-store experience for customers and streamline the business, part of his pledge to bring back the more personal coffeehouse atmosphere for which Starbucks was originally known. He has called for changes to the mobile ordering systems to address surges in orders, and has cut some items from Starbucks’ menu. The company also announced that it would not increase prices for the 2025 fiscal year.
Last month, Mr. Niccol shook up the chain’s leadership in North America, a market that accounts for about three-quarters of its revenue. Mike Grams, formerly the president and chief operating officer of Taco Bell, and Meredith Sandland, who was chief executive of Empower Delivery, a restaurant software company, were named to two new roles overseeing store performance, development and design.
“We’re on track to turn the business around,” Mr. Niccol told Wall Street analysts and investors on an earnings call last month, his first since joining the company in September. “But much of our work is just beginning.”
Mr. Niccol was one of the highest-paid corporate executives last year. Starbucks paid Mr. Niccol $96 million in 2024 to make up for what he would have earned if he had stayed at Chipotle, where he previously was chief executive for six years.
Mr. Niccol also secured a commuting perk: Starbucks agreed to let him use its corporate plane to fly 1,000 miles from his home in Newport Beach, Calif., to the company’s headquarters in Seattle. Mr. Niccol said on Monday that Starbucks would start requiring employees at the vice president level and above to work from either its Seattle or Toronto offices three days a week.
Most of Starbucks’ employees work in its company-operated stores. Mr. Niccol became chief executive amid a union drive among baristas in the United States that began in 2021; more than 500, or about 5 percent, of its company-owned U.S. locations have organized. The company and Workers United, the union that represents thousands of Starbucks workers, agreed last month to bring in a mediator to revive contract talks, which had stalled over wage increases.
“It’s clearer than ever that baristas are central to Starbucks’ turnaround,” Michelle Eisen, a longtime Starbucks barista who has helped lead the organizing campaign, said on Monday.
