Starbucks Corp (NASDAQ:SBUX) stock rose Thursday following the coffee giant’s announcement of a reimagined loyalty program and mixed fiscal first-quarter earnings results reported on Wednesday. The stock has reversed earlier gains and is now trading lower.Rewards ProgramStarbucks unveiled a new three-tiered loyalty structure for its 35.5 million active U.S. members, set to launch Mar. 10. The updated Starbucks Rewards program introduces Green, Gold, and Reserve membership levels, each offering escalating be ...

Starbucks Unveils Reimagined Loyalty Program The updated Starbucks Rewards program, which launches on March 10, introduces three levels of membership – Green, Gold and Reserve – offering new and exclusive benefits for members. The updated Starbucks Rewards program, which launches on March 10, introduces three levels of membership – Green, Gold and Reserve – offering new and exclusive benefits for members. Inspired by member feedback, the program is designed to strengthen connection and drive growth. T ...

This story was originally published on CX Dive. To receive daily news and insights, subscribe to our free daily CX Dive newsletter. Dive Brief: Starbucks’ turnaround plan is showing signs of success, with the company recording increases for both Starbucks Rewards and non-Rewards transactions for the first time since the second quarter of 2022, CEO Brian Niccol said on a Q1 2026 earnings call Wednesday. Better experiences have been a major part of the plan, including wait time reduction. The company ha ...

Core Insights - Dutch Bros is diversifying its menu, with 25% of its 2024 sales coming from hand-mixed Rebel energy drinks, which are growing faster than hot coffee sales [1] - The company operates small coffee shops with minimal dine-in facilities, leading to faster store construction and lower operational costs [1] - Dutch Bros has experienced a significant stock decline of over 27% in the last month, while year-to-date performance shows declines of 9% for Dutch Bros and 10.9% for Starbucks, contrasting with a 14.2% gain in the S&P 500 [5] Dutch Bros Overview - The company aims to create a friendly customer experience through its "Broistas," primarily serving drinks at drive-through windows [2] - Dutch Bros has the potential for significant growth, with an average annual return of 14.3% over nearly three decades, although past performance does not guarantee future results [2][6] - The company is positioned differently from Starbucks, which is seen as a mature business with limited long-term growth prospects [4] Starbucks Challenges - Starbucks has struggled with stock performance, down slightly over the past six years, while the S&P 500 has more than doubled [7] - The company has faced challenges in expanding its international business, particularly in China, and has relied heavily on price increases for growth, which is no longer sustainable [8] - Starbucks' customer experience has become more transactional, leading to pressure on margins and stagnating growth [9] Strategic Moves by Starbucks - Starbucks is undergoing a transformation under CEO Brian Niccol, focusing on improving store quality rather than expanding the number of locations [12][13] - The company plans to renovate 1,000 existing stores and eliminate 900 non-retail partner roles, signaling a shift from growth mode to stabilization [12][13] - Despite challenges, Starbucks remains a strong brand with a recent dividend increase, indicating potential for long-term investment [15][16]

Core Viewpoint - The article highlights three companies—Lockheed Martin, ExxonMobil, and Starbucks—that are expected to grow their dividends in the near future, making them attractive options for investors seeking passive income [2]. Lockheed Martin - Lockheed Martin is known for its consistent dividend increases, having raised its payout for 22 consecutive years, with expectations for another increase this fall [3][4]. - The company has a high dividend yield of 2.7% and a forward price-to-earnings ratio of 22.2, indicating good value despite recent growth challenges [4]. - Lockheed's backlog stands at $166.5 billion, more than double its projected 2024 revenue, which is expected to generate significant free cash flow to support dividend growth [5]. ExxonMobil - ExxonMobil has a strong track record of dividend increases, having raised its dividend for 42 consecutive years, and is projected to continue this trend due to its focus on production quality [7]. - The company aims to increase earnings by $20 billion and operating cash flow by $30 billion by 2030, with a capital expenditure plan of $28 billion to $33 billion annually from 2026 to 2030 [8]. - ExxonMobil plans to return value to shareholders through $20 billion in stock buybacks and over $17 billion in dividends this year, with a current yield of 3.4% [9]. Starbucks - Starbucks has increased its dividend for 14 consecutive years, but faces challenges from competition and changing consumer preferences [10][12]. - The company is undergoing a turnaround strategy under new CEO Brian Niccol, focusing on improving the in-store experience while managing costs [12][13]. - Despite recent struggles, Starbucks maintains a dividend yield of 2.9%, making it a potential passive income opportunity for investors who believe in the brand's resilience [14][15].

Core Insights - McDonald's Corporation is undergoing a multi-year, technology-led transformation aimed at reshaping its cost structure and enhancing customer engagement through its "Accelerating the Arches" strategy, supported by three digital platforms: restaurant, consumer, and company [1][4] Technology Deployment - The implementation of edge computing in U.S. restaurants enables AI and IoT capabilities, such as predictive maintenance and automated order taking, resulting in over 50% reduction in wait times in pilot markets, thereby improving service speed and customer satisfaction [2][10] Consumer Engagement - McDonald's loyalty program has exceeded 185 million active users globally as of Q2 2025, with U.S. members more than doubling their annual visits from 10.5 to 26, and a target of 250 million active users by 2027 to enhance repeat spending and digital engagement [3][10] Operational Framework - By integrating technology across various functions, McDonald's is establishing a scalable operating framework that supports revenue growth and margin resilience, with significant investments planned for 2025-2026 to achieve operating leverage as digital platforms mature [4][5] Competitive Landscape - In comparison, Starbucks has approximately 34 million active members in its rewards program, while Chipotle's online and app-based transactions account for 35.5% of sales, indicating a competitive focus on digital strategies across the industry [6][7] Stock Performance - McDonald's shares have increased by 2.4% over the past three months, contrasting with a 3.2% decline in the industry, indicating relative strength in its stock performance [8] Valuation Metrics - McDonald's trades at a forward price-to-sales ratio of 8.14, significantly higher than the industry average of 3.79, suggesting a premium valuation [12] Earnings Estimates - The Zacks Consensus Estimate for McDonald's earnings per share indicates a year-over-year increase of 5.5% for 2025 and 8.2% for 2026, with recent upward revisions in estimates [14]

Core Insights - Starbucks Corporation (SBUX) is enhancing its digital ecosystem to boost transactions, increase ticket size, and improve customer experience [1] Group 1: Customer Engagement and Loyalty - In Q3 of fiscal 2025, Starbucks reported nearly 34 million 90-day active Rewards members in the U.S., with non-discounted transactions growing within this base [2] - The U.S. ticket size increased by 2% as the company reduced discounted transactions by about one-third, indicating stronger spending without heavy promotions [2][5] Group 2: Operational Improvements - Starbucks is implementing operational enhancements such as Green Apron Service and SmartQ to improve order speed and accuracy, achieving faster handoffs with about 80% of in-cafe orders completed in under four minutes [3] - Drive-thru times are below four minutes, and Mobile Order and Pay transactions are delivered more accurately and on time [3] Group 3: Future Plans and Digital Upgrades - The company plans further digital upgrades in 2026, including a reimagined Rewards program, a new mobile app, and additional improvements to Mobile Order and Pay [4] - The pickup-only store format will be phased out in favor of community coffeehouses paired with strong digital convenience [4] Group 4: Delivery Growth - Delivery remains a fast-growing digital channel for Starbucks, with transactions increasing by over 25% year over year, contributing significantly to incremental sales [4][9] Group 5: Market Performance and Valuation - Starbucks shares have gained 7.7% in the past three months, contrasting with a 3.1% decline in the industry [6] - The company trades at a forward price-to-sales ratio of 2.72, below the industry's average of 3.79, while competitors Dutch Bros and Chipotle have higher ratios of 6.22 and 4.39, respectively [10] Group 6: Earnings Estimates - The Zacks Consensus Estimate for SBUX's fiscal 2025 EPS indicates a decline of 30.5% year over year, while the estimate for 2026 shows a rise of 18.2% [12]

Core Insights - Starbucks Corporation (SBUX) is implementing a turnaround strategy through a "test-and-scale" approach, focusing on disciplined experimentation rather than sweeping changes [1] - The "Back to Starbucks" plan involves piloting operational and experiential improvements in select stores, scaling successful initiatives to enhance customer experience and efficiency [1] Operational Improvements - The green apron service model has been introduced to improve speed and partner connection during peak hours, expanding from a few stores to nearly 2,000 locations with promising results [2] - A new order sequencing algorithm has been tested, resulting in a reduction of average café wait times by approximately two minutes, with 75% of peak-hour orders fulfilled in under four minutes [3] - The iterative process includes menu simplification, beverage innovation, and store design enhancements, with a pause on the rollout of capital-intensive equipment in favor of labor-focused adjustments [4] Strategic Framework - Starbucks employs a structured framework of test, learn, refine, and scale to minimize execution risk and align upgrades with partner capability and customer demand, aiming for profitable transactions and improved long-term unit economics [5] Industry Comparison - Dutch Bros Inc. (BROS) is also using an iterative strategy, particularly in digital ordering, with its Order Ahead program achieving double the transaction penetration rate compared to the system average [6] - Chipotle Mexican Grill, Inc. (CMG) is taking a hybrid approach, combining operational pilots and equipment-driven innovations to enhance throughput and guest experience, with plans for new equipment rollouts in 2025 [7] Financial Performance - Starbucks shares have increased by 11.5% over the past three months, outperforming the industry average rise of 4.6% [8] - The Zacks Consensus Estimate for SBUX's fiscal 2025 earnings per share (EPS) indicates a decline of 25.1% year over year, while fiscal 2026 EPS is expected to rise by 20.5% year over year [12] - Starbucks currently trades at a forward price-to-sales ratio of 2.80, below the industry's average of 4.07X [17]

Core Insights - McDonald's Corporation (MCD) is focusing on digital and loyalty capabilities as a key growth strategy amidst macroeconomic challenges and varying global traffic trends [1] - The company remains confident in the long-term value of digital engagement despite current consumer weaknesses affecting comparable sales [1] U.S. Market Performance - In the U.S., McDonald's app-based digital offers and the McValue platform have helped stabilize guest counts, even as total U.S. comparable sales declined by 3.6% during the quarter [2] - The recent $5 Meal Deal and Buy One, Add One for $1 promotions were primarily driven through the app, highlighting its importance in customer engagement [2] International Market Performance - Internationally, digital loyalty adoption has led to market share gains in countries like France, Germany, and Canada, despite a decline in quick-service restaurant (QSR) traffic [3] - Canada experienced significant success with the "Hockey Showdown" digital campaign, boosting both engagement and sandwich category sales [3] Customer Satisfaction and Strategy - Customer satisfaction scores reached all-time highs in the U.S. and key international markets, reflecting the effectiveness of digital channels and personalized rewards [4] - McDonald's is leveraging data-driven marketing and loyalty expansion to navigate industry challenges and enhance competitiveness [4] Competitive Landscape - Competitors such as Starbucks and Yum! Brands are also enhancing their digital and loyalty strategies, with Starbucks' Rewards program having over 34 million active U.S. members [5][6] - Yum! Brands reported that Taco Bell's loyalty membership surpassed 60 million globally, and digital sales accounted for 45% of total sales, indicating strong loyalty integration [7] Financial Performance - McDonald's shares have increased by 16.7% over the past year, outperforming the industry's growth of 10.6% [8] - The company's forward 12-month price-to-earnings ratio is currently at 22.93, lower than the industry's 25.89 [11] - The Zacks Consensus Estimate for MCD's 2025 earnings per share has seen an increase over the past 30 days [12]