Starbucks announced plans to expand its global footprint with 17,000 new locations by 2030 — while cutting $3 billion in costs within the next three years.
After reporting fiscal fourth-quarter results that beat Wall Street’s expectations, the coffeehouse chain revealed its ambitious plan to have 55,000 locations globally by the end of the decade, up from its current count of roughly 38,000.
In what Starbucks called its “Triple Shot Reinvention Strategy,” the company said that along with becoming more global, it plans to “unlock efficiency to generate $3 billion in savings over three years.”
Of those savings, $2 billion will come from outside the store, Starbucks said, though it was stingy on details of the cost-savings plan.
It seems like a lofty goal considering the Seattle-based coffee chain also announced that it plans on doubling US workers’ hourly income over fiscal 2020 earnings by the end of 2025.
Starbucks said it believes investing in its American employees will will bolster tenure at US stores.
The company has a workforce of over 450,000, CEO Laxman Narasimhan confirmed in Thursday’s announcement, though it wasn’t immediately clear how many of those workers were based among Starbucks’ 16,000-plus stores in the US.
According to employment website Indeed, a Starbucks barista earns an average of $17.03 per hour, though hourly wages run as low as $8.55 or as high as $25.70.
Starbucks Workers United, which represents nearly 9,000 of Starbucks’ baristas but isn’t affiliated with the coffeehouse chain, has proposed a base wage of $20 per hour for all workers, “with a fair way to calculate higher base wage in high-cost areas.”
The union has also demanded strong annual raises of 5% and cost-of-living adjustments, as well as “seniority raises that reward longevity” and retirement contributions.
It’s unclear if Starbucks vowed to double US workers’ wages in response to the union, which comes just two weeks after both entities filed warring lawsuits against each other over Workers United’s social media post declaring “Solidarity with Palestine!” following Hamas’ deadly attacks.
In the wake of the union’s “inflammatory and misleading communication” in the since-deleted post on X, Starbucks swiftly moved to distance itself from Workers United, issuing a statement that said, “Workers United’s words and actions belong to them, and them alone.”
The New York-based union is actually an affiliate of Service Employees International Union (SEIU), which has more than 2 million members working across a range of industries in the US and Canada.
Ahead of announcing its “Triple Shot Reinvention Strategy” on Thursday, Starbucks reported its fiscal fourth-quarter results for the three-month period ended Oct. 1, which showed that revenue was up 11% to a record $9.4 billion.
Starbucks Reward Members also increased 14% year-over-year, to 32.6 million, as global store sales advanced 8%.
The positive earnings report sent shares up 9.5% in late Thursday trading hours, giving Starbucks a market cap of $115 billion as of the closing bell.