Former Starbucks CEO Howard Schultz expressed the need for the coffee giant to undergo a strategic overhaul after its earnings “significantly” fell short of shareholder expectations. 

In a LinkedIn post on Sunday, Schultz, who stepped down as interim CEO in March 2023, and from the company’s board of directors a month later, spoke candidly about the company’s “fall from grace,” particularly in the U.S. market.

Not only has the company been dealing with ongoing unionization efforts nationwide, but it is also feeling “the impact of a more cautious consumer,” CEO Laxman Narasimhan said. Last week, the company reported that its quarterly net revenue slipped 2% to $8.6 billion. Same-store sales in the quarter fell 4%, the first decline since 2020.

FOX Business reached out to Starbucks for comment.

STARBUCKS’ HOWARD SCHULTZ SAYS HE WON’T RETURN AS CEO

“I have emphasized that the company’s fix needs to begin at home: U.S. operations are the primary reason for the company’s fall from grace,” Schultz said in the LinkedIn post.

To start, “the stores require a maniacal focus on the customer experience, through the eyes of a merchant,” he said. “The answer does not lie in data, but in the stores.” 

Since Narasimhan took over last spring, he has been implementing the company’s “reinvention plan,” which he has said requires a continued focus on long-term hiring and retention as well as investing in partner wages and revamping store operations. 

At the start of 2024, eligible U.S. retail hourly partners saw an incremental pay increase of at least 3%. In March, the company created a new role of CEO for North America shortly after it began revamping its U.S. store portfolio with a new inclusive framework to give the customers minimal friction when ordering. The lighting and structural changes are also geared to make it easier for people to hear one another as well as get their work done in its shops.

Despite the ongoing efforts, Schultz, who had served as chief executive from 1986 to 2000 and again from 2008 to 2017 before temporarily taking over in 2022, argued that “senior leaders—including board members—need to spend more time with those who wear the green apron.” 

STARBUCKS RE-ALIGNS TOP LEADERSHIP ROLES SPLITTING US AND INTERNATIONAL CEOS

He added that the first thing the company needs to do is “reinvent” its mobile ordering and payment platform. 

Additionally, “the go-to-market strategy needs to be overhauled and elevated with coffee-forward innovation that inspires partners, and creates differentiation in the marketplace,” which would reinforce the company’s premium position, according to Schultz.

The former chief executive acknowledged that “‘a miss’ is virtually inevitable even at the best-managed, fastest-growing firms.” 

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But he argued that what comes after the miss is what matters. 

“At any company that misses badly, there must be contrition and renewed focus and discipline on the core. Own the shortcoming without the slightest semblance of an excuse. There is a natural tendency to try to do too much too soon. Don’t try to do everything at once.” 

FOX Business’ Breck Dumas and Greg Norman contributed to this report. 

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During his “My Take,” Monday, “Varney & Co.” host Stuart Varney discussed the Chicago Teachers Union’s new contract demands of $50 billion to pay for wage hikes, migrant care, abortions, gender-neutral bathrooms and police-free schools.

STUART VARNEY: The Chicago teachers’ union is negotiating a new contract. 

The union’s opening bargaining position has been leaked.

CHICAGO TEACHERS’ $50B DEMANDS INCLUDE PAY HIKES ABORTION, MIGRANT ACCOMODATION

When you see their demands, you know America’s big cities are in deep, deep trouble.

Here’s just a sampling.

A 9% pay increase. The average teacher pay is already $93,000, among the highest in the land.

$2,000 for each migrant child, to help them settle.

CHICAGO TEACHERS UNION URGES STUDENTS TO ATTEND POLITICAL RALLY FOR ILLINOIS PRIMARY

Teachers are to be paid $1,000 per student, per semester, if the class size goes over the official limit.

100% coverage for all teacher abortions. Police-free schools.

All 646 Chicago public schools must have a gender-neutral bathroom. Total cost: $50 billion. 

By the way, union President Stacey Davis Gates, sent her son to a private school after calling school choice racist.

OK, these are opening demands. No way they will be fully implemented.

But it shows the state of mind that’s taken hold. Academic standards are at rock bottom. 

CHICAGO TEACHERS UNION PRESIDENT USED ‘UNLAWFUL DEDUCTION’ ON HOME FOR OVER A DECADE

So, the teachers demand a massive pay increase anyway?

Chicago is spending hundreds of millions of dollars on illegal migrants. 

So, the teachers want to give them more?

It’s what we see in virtually all the Democrat-run big cities. Businesses are leaving. 

Residents are leaving. The migrant flood never stops. City finances are in a shambles. 

Schools are overwhelmed. But in Chicago, there is no sign of any policy reversal. Same old, same old. Not sustainable.

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