The new boss of Starbucks says he will overhaul the global coffee chain’s menu as the company continues to see its sales slide.
Brian Niccol also announced that he was suspending the firm’s financial forecasts for the coming year due to the “current state of the business”.
At the same time, the firm reported preliminary quarterly profits showing its sales and profits had dropped.
Starbucks shares fell by more than 4% after the announcement.
Starbucks needed to “fundamentally change” to bring back customers, Mr Niccol, who took over as chief executive in September, said.
“We will simplify our overly complex menu, fix our pricing architecture, and ensure that every customer feels Starbucks is worth it every single time they visit.”
Starbucks has seen customers cut back on spending as the rising cost of living squeezed people’s budgets.
A week before Starbucks was due to release its results for the three months to the end of September, the company said it expects comparable sales in the US to have fallen by 6% compared to a year earlier.
The downturn was more dramatic in China, where sales fell 14% for the same period, as the economy there falters.
“Despite our heightened investments, we were unable to change the trajectory of our traffic decline,” said Rachel Ruggeri, Starbucks chief financial officer.
Mr Niccol, who previously headed the Mexican food chain Chipotle, was brought into Starbucks to help turn the business around.
But he faced criticism over his plan to commute almost 1,000 miles (1,600km) from his family home in Newport Beach, California, to the firm’s headquarters in Seattle on a corporate jet.
Critics saw it as in contradiction with the company’s public stance on green issues.
