Starbucks Raises Salaried Employees by 2% Amid Turnaround Efforts

Starbucks will give all salaried employees in North America a 2% raise this year as part of a turnaround effort to improve service, reduce wait times, and create more inviting stores. The raise applies to corporate staff, manufacturing, and distribution workers, as well as retail leadership. The company is working to reverse six quarters of same-store sales declines and has implemented various workforce changes, including layoffs and stock grants for executives.

Starbucks Corporation has announced that it will provide a 2% raise to all salaried employees in North America as part of its ongoing turnaround strategy. The raise, which will be effective for the fiscal year ending in late September, is a significant shift from previous years when salary increases were decided at the discretion of managers [1].

This move is part of a broader effort by Starbucks to enhance customer experience by improving service, reducing wait times, and creating more inviting stores. The company has been working to reverse six consecutive quarters of same-store sales declines. CEO Brian Niccol has implemented various initiatives, including menu refreshes, increased staffing, and the introduction of technology to streamline orders [1].

The 2% raise applies to a wide range of employees, including corporate staff, manufacturing and distribution workers, and retail leadership such as store managers, who are typically salaried. This consistent approach to merit increases is designed to help manage costs while investing in the company's turnaround efforts [1].

Despite a recent earnings miss, several analysts have upgraded Starbucks' stock ratings and target prices. The average target price is now set at $103.65, with a consensus rating of "Hold." The company's stock has shown resilience, with a market capitalization of $102.99 billion and a PE ratio of 39.05 [2].

Starbucks' turnaround strategy also includes workforce changes such as tightening the dress code for baristas and laying off 1,100 corporate workers. Additionally, some executives have been granted stock grants with a $6 million target value each, contingent on successfully managing costs and delivering on the turnaround [1].

Investors are closely watching Starbucks' performance, with analysts expecting a slight increase in comparable-store sales in the current quarter. The company has also declared a quarterly dividend of $0.61 per share, payable on August 29th [2].

References:
[1] https://www.bloomberg.com/news/articles/2025-08-18/starbucks-salaried-workers-will-get-2-raises-this-year
[2] https://www.marketbeat.com/instant-alerts/filing-alliance-wealth-advisors-llc-ut-boosts-holdings-in-starbucks-corporation-nasdaqsbux-2025-08-16/