WASHINGTON (September 29, 2025) – Starbucks has announced 900 layoffs and plans to close nearly 1,000 cafes, marking a second round of cuts since CEO Brian Niccol took over last year.
“The first set of layoffs proved largely symbolic, 900 layoffs for a company with over 200,000 didn’t make a dent, but a second round signals a new chapter in the company’s transformation” says Chris Kayes, chair of the department of management and professor of management at the George Washington University School of Business.
Niccol’s initial strategy centered on customer experience: upgraded cafés, standardized processes, and quality touches like ceramic mugs. Results were mixed: customers welcomed the changes, but sales continued to decline. The latest layoffs suggest a pivot to a more traditional Wall Street strategy focused on margins and financial performance.
Kayes notes that shifting consumer habits, what he calls the “grab and go” effect, pose a deeper challenge. Nearly 60% of U.S. coffee purchases now happen at drive-throughs, yet only half of Starbucks cafes offer this option, leaving the company vulnerable as consumer preferences evolve.
If you would like to schedule an interview with Professor Kayes, please contact Claire Sabin at claire [dot] sabin
gwu [dot] edu (claire[dot]sabin[at]gwu[dot]edu).
-GW-