With operating profit down 45%, the “Back to Starbucks” plans aren’t bearing any fruit yet

Brian Niccol has a tough gig on his hands, with Starbucks shares dropping sharply after a weak quarter.

4/30/25 8:34AM

Starbucks is promising a four-minute wait time for customers to get their grande latte, but investors might have to wait longer for the coffee giant to deliver the results they were hoping for when Brian Niccol took the top job at Starbucks in September.

The world’s largest coffee chain posted a 45% decline in quarterly operating income yesterday, its fifth straight quarter of declining same-store sales, with SBUX shares opening down 10% in premarket trading this morning.

Since being poached in September for his star-studded track record at Chipotle, CEO Brian Niccol has been brewing a bold turnaround strategy to reverse Starbucks’ yearlong sales slump. So far, that “Back to Starbucks” plan has involved writing names on to-go cups, bringing back ceramic mugs, and requiring a purchase for customers to loiter in stores.

But the investment is coming at a cost: while Niccol touted some “real momentum” with his magnum opus on Tuesday, Starbucks also said the additional labor poured to support the plan is grinding down on the coffee giant’s profitability — an expense that the chain is seemingly willing to double down on, with plans to hire even more baristas.

Double shot

Starbucks’ slumping profitability, down to become the worst non-Covid quarter in more than a decade, is another bitter shot of disappointment for the already struggling coffee chain, which has been juggling weak consumer spending and skyrocketing costs of coffee beans (thanks to a certain Diet Coke enthusiast) domestically while being squeezed out by strong competitors in China — a region that had been the Starbucks growth engine for much of the last two decades.

Max Knoblauch

18h

Reddit bounces on report that it’s in talks with Google, OpenAI on fresh data-sharing deal

Reddit shares were down 5% in Wednesday trading before news that the company is in early talks to make its next AI content-sharing deals with Google and OpenAI sent them back up to roughly flat.

According to reporting by Bloomberg, Reddit is seeking a new data deal structure that includes dynamic pricing and would encourage the companies’ AI users to contribute to Reddit.

Reddit reportedly struck deals of $60 million per year with Google and OpenAI last year. The company scored $35 million in “other” revenue — which includes content licensing agreements — in its most recent quarter. That accounted for about 7% of the company’s overall revenue in the period.

“One of the things that we’ve learned, particularly through the data licensing deals is... how essential Reddit is to AI or LLMs as we know them and the next generation of search,” Reddit CEO Steve Huffman said on the company’s July earnings call. “And so I think a lot has changed over the last couple of years. Every variable has changed since we signed those first deals.”

Reddit Seeks to Strike Next AI Content Pact With Google, OpenAI

21h

DO YOU EVEN SIP, BRO?

Adam Chandler

Hyunsoo Rim

22h

VF Corp. is shedding its century-old workwear icon, Dickies, after years of struggle

The brand’s sales have been going backward for three straight years.

$100B

Nia Warfield

9/16/25

Alphabet’s YouTube said it’s paid out over $100 billion to creators, artists, and media companies over the past four years — cementing its place as one of the internet’s biggest talent magnets. The Google-owned platform, which turned 20 this year, credited connected TVs as a major driver of growth.

YouTube said the number of channels earning over $100,000 from TV screens has surged over 45% in the past year alone. Meanwhile, ad revenue for YouTube grew double digits in Q2 to $9.8 billion, topping the Street’s estimates.

Nia Warfield

9/16/25

Webtoon surges after Disney plans to invest and partner in digital push for brands like Marvel and “Star Wars”

Webtoon Entertainment shares jumped 36% in premarket trading Tuesday after Disney said it’s buying a 2% stake in the digital comics platform. The investment is part of a deal to bring Marvel, “Star Wars,” Pixar, and 20th Century Studios titles into a new streaming-style app run by Webtoon. The offering will launch in Q4 across the US and nine other countries.

“With a new platform that will combine our product and technical expertise with Disney’s full comic catalog, we’re giving new and longtime fans all over the world a new way to discover these legendary characters and stories,” said Junkoo Kim, founder and CEO of Webtoon Entertainment.

The platform is expected to host more than 35,000 titles, mixing archived comics with Webtoon originals. Disney+ perks could also be on the table, giving the service a natural tie-in to Disney’s broader streaming play.

The arrangement isn’t final yet: Disney’s stake and the platform details are still under negotiation. But with Webtoon’s ~155 million monthly active users, the partnership gives Disney a mobile-friendly channel for its comics while Webtoon gains the ultimate IP access.