Starbucks (SBUX.US) to outsource tech work after cutting over 1,000 jobs

Starbucks (SBUX.US) is outsourcing some technology work. "We are rebalancing the mix of internal and outsourced talent," said Deb Hall Lefevre, the company's chief technology officer, in a memo. The memo showed the company's goal is to move full-time employees to its most important projects while relying on service providers' "speed and flexibility." Starbucks declined to say how many jobs it would outsource or to which third-party vendors. An important internal technology team will remain, while external talent will be used for more routine work, the company said. The memo showed the technology team would undergo a broader reorganization involving data and analytics, engineering and other functions. Starbucks announced on Monday that it would cut 1,100 jobs and trim 30% of its menu items to reverse declining sales. It is the first time Starbucks has cut jobs since 2018. The company's chief executive, Brian Niccol, said the move would improve efficiency and reduce complexity. Notably, the 1,100 job cuts Starbucks announced on Monday are just one part of its downsizing. Brian Niccol said in a letter to employees that the company would cut 1,100 jobs that are currently filled, as well as "hundreds" of unfilled positions. Brian Niccol previously announced the pending layoffs, saying the company had too many layers, "Our goal is to improve operational efficiency, strengthen accountability, reduce complexity and drive better integration." The moves come as Starbucks faces pressure on its performance. The company reported its first-quarter fiscal 2025 (ended Dec. 29, 2024) results, with revenue of $9.398 billion, down 0.3% year-on-year; net profit of $781 million, down 23.8% year-on-year.