Former Starbucks CEO and founder Howard Schultz believes the company’s leaders should spend more time in stores and focus on coffee drinks as they attempt to revive declining sales.

In a LinkedIn article published over the weekend, Schultz stated that many people had contacted him after Starbucks reported lower-than-expected quarterly sales and earnings last week.

The Seattle coffee company reported a 2% reduction in income from January to March as global shop traffic slowed. The company’s quarterly revenue decreased for the first time since 2020. Starbucks also reduced its full-year sales and earnings projections.

Starbucks Founder Schultz Says Company Needs To Refocus On Coffee As Sales Struggle

Schultz, who purchased Starbucks in 1987, is credited with transforming the firm into the global juggernaut it is today, with roughly 39,000 locations globally. He has been the company’s chairman emeritus since last October when he stepped down from Starbucks’ board.

Schultz remains Starbucks’ largest individual stakeholder, with shares worth $1.5 billion at the end of last year.

In his post, Schultz stated that senior executives, including board members, should spend more time chatting with baristas in the company’s stores.

“I have emphasized that the company’s fix needs to begin at home: U.S. operations are the primary reason for the company’s fall from grace,” he stated. “The stores require an obsessive concentration on the client experience, as seen through the perspective of a merchant. The answer is not found in statistics, but in stores.”

Since last spring, Laxman Narasimhan, Starbucks’ CEO, has worked a half-day shift in Starbucks outlets once a month.

Schultz appeared to challenge Narasimhan’s turnaround plans at times throughout his post. During a conference call with investors last week, Narasimhan noted several new products that he believes will drive people into stores later this year, including boba drinks, sugar-free alternatives, and the brand’s first energy drink.

Starbucks Founder Schultz Says Company Needs To Refocus On Coffee As Sales Struggle

However, Schultz stated that coffee distinguishes Starbucks and reinforces the company’s premium position.

“The go-to-market strategy needs to be overhauled and elevated with coffee-forward innovation,” he said.

Schultz also stated that the company’s mobile ordering and payment infrastructure should be updated to “once again make it the uplifting experience it was designed to be.” He did not indicate what modifications he believes should be made. Last autumn, Narasimhan stated that Starbucks is accelerating the rollout of new digital capabilities and attempting to customize the user experience via its app.

A message seeking a response to Schultz’s post was placed with Starbucks on Monday.

Starbucks Founder Schultz Says Company Needs To Refocus On Coffee As Sales Struggle

Schultz has a habit of stepping in when he notices Starbucks faltering. He retired as CEO in 2000 and became the company’s chairman before returning as CEO in 2008, during the recession.

Schultz stood down again in 2017 but will return to manage the corporation on a temporary basis beginning in 2022. In 2023, he appointed Narasimhan, a former PepsiCo executive, as CEO. Schultz stepped down from Starbucks’ board last October and became chairman emeritus.

SOURCE – (AP)

Boeing has locked out its private force of firefighters who protect its aircraft production sites in the Seattle area and hired replacements after the most recent round of negotiations with the firefighters’ union failed to yield a wage deal.

The firm claimed on Saturday that it had locked out approximately 125 firemen as well as a plant in central Washington, which is about 170 miles (275 kilometers away). Firefighters are first responders to fires and medical situations and might request assistance from local fire departments.

“Despite extensive discussions through an impartial federal mediator, we did not reach an agreement with the union,” the company stated. “We have now locked out members of the bargaining unit and fully implemented our contingency plan with highly qualified firefighters performing the work of (union) members.”

Boeing Locks Out Its Private Firefighters Around Seattle Over Pay Dispute

In a statement issued Saturday, the International Association of Firefighters union stated that Boeing’s lockout is intended to “punish, intimidate, and coerce its firefighters into accepting a contract that undervalues their work.”

“Putting corporate greed ahead of safety, Boeing has decided to lockout our members, putting the safety of the Washington facilities at unnecessary risk,” stated Edward Kelly, IAFF general president.

Boeing insisted that the lockout would have “no impact” on its operations.

The labor conflict comes as Boeing faces rising losses—more than $24 billion since the beginning of 2019—and renewed scrutiny of quality and safety in its manufacture after a door plug blew out of an Alaska Airlines Boeing 737 Max flying over Oregon in January.

Boeing Locks Out Its Private Firefighters Around Seattle Over Pay Dispute

Boeing and the union remain far apart in their negotiations, which have been ongoing for two and a half months. Each side accuses the other of engaging in bad-faith negotiations.

The firm, headquartered in Arlington, Virginia, announced on Saturday that its current offer includes general yearly wage increases and a new compensation structure for firemen working a 24-hour shift pattern, which would result in an average annual income rise of roughly $21,000. According to Boeing, last year’s average pay for firefighters was $91,000.

The union, which claims Boeing has saved billions of dollars in insurance costs by hiring its on-site firefighters, has requested rises of 40% to 50%. Boeing’s planned pay hike would still result in crews earning 20% to 30% less than firefighters in towns where Boeing plants are situated, according to the union.

Boeing Locks Out Its Private Firefighters Around Seattle Over Pay Dispute

A key sticking point is Boeing’s requirement that firemen wait 19 years to reach the top pay bracket, up from 14 years. The union proposes five years.

SOURCE – (AP)

OMAHA, Nebraska – Warren Buffett warned the tens of thousands of shareholders who crowded an arena for his annual meeting that AI frauds might become “the growth industry of all time.”

Doubling down on his warnings from last year, Buffett informed the crowd that he had just encountered the disadvantages of artificial intelligence. And it looked and sounded exactly like him. Someone created a phony film of Buffett, which appeared to be convincing enough that the so-called Oracle of Omaha admitted he could imagine it deceiving him into moving money offshore.

The wealthy investing guru predicted that crooks will grasp the technology and cause more harm than good.

“As someone who doesn’t understand a damn thing about it, it has enormous potential for good and enormous potential for harm and I just don’t know how that plays out,” he was quoted as saying.

Warren Buffett Says AI May Be Better For Scammers Than Society. And He’s Seen How

The day began early Saturday with Berkshire Hathaway reporting a significant decline in earnings as the paper worth of its investments fell, and it reduced its Apple holdings. In the first quarter, the business posted a $12.7 billion profit, or $8,825 per Class A share, a 64% decrease from $35.5 billion, or $24,377 per A share, the previous year.

However, Buffett advises investors to focus more on the conglomerate’s operating earnings from the companies it actually owns. These increased by 39% to $11.222 billion, or $7,796.47 per Class A share, driven by the success of insurance businesses.

Nothing that got in the way of having fun.

Crowds flocked to the arena to buy Squishmallows of Buffett and former Vice Chairman Charlie Munger, who died last October. The gathering draws investors worldwide and is unlike any other business meeting. Those attending for the first time are motivated by a desire to be here while Buffett, 93, is still alive.

“This is one of the world’s top events for learning about investment. “To learn from the gods of the industry,” said Akshay Bhansali, who traveled from India to Omaha for nearly two days.

Devotees go from all over the world to gather pearls of wisdom from Buffett, who memorably nicknamed the event ‘Woodstock for Capitalists.’

However, one missing aspect this year was the first meeting after Munger’s death.

The gathering began with a video homage featuring some of his most famous statements, including the legendary line, “If people weren’t so often wrong, we wouldn’t be so rich.” The movie also included pranks the investors had done with Hollywood celebs over the years, including a “Desperate Housewives” spoof in which one of the women introduced Munger as her lover and another in which actress Jaimie Lee Curtis swooned over him.

Warren Buffett Says AI May Be Better For Scammers Than Society. And He’s Seen How

As the film ended, the arena erupted in a sustained standing ovation for Munger, whom Buffett referred to as “the architect of Berkshire Hathaway.”

Buffett stated that Munger remained curious about the world until his death at 99, throwing dinner parties, meeting with people, and making regular Zoom calls.

“Like his hero Ben Franklin, Charlie wanted to understand everything,” Buffett said.

For decades, Munger and Buffett served as a legendary comic pair, with Buffett providing lengthy setups to Munger’s sharp one-liners. He once called unproven internet startups “turds.”

Together, they transformed Berkshire from a struggling textile mill into a vast conglomerate of diverse interests, from insurance companies such as Geico to the BNSF railroad, many major utilities, and a slew of other businesses.

Munger frequently described the key to Berkshire’s success as “trying to be consistently not stupid, instead of trying to be very intelligent.” He and Buffett were also recognized for sticking to businesses that they knew well.

“Warren would always do at least 80% of the talking. But Charlie made an excellent foil,” said Stansberry Research analyst Whitney Tilson, who was looking forward to his 27th consecutive meeting.

Munger’s absence, however, allowed shareholders to get to know the two executives who directly supervise Berkshire’s companies: Ajit Jain, who runs the insurance operations, and Abel, who handles everything else and has been anointed Buffett’s successor. This year, they performed alongside Buffett on the main stage.

When Buffett initially asked Abel a question, he accidentally said, “Charlie?” Abel shrugged off the error and delved into the issues that utilities face due to the increasing risk of wildfires and certain regulators’ unwillingness to allow them to make a respectable profit.

Morningstar analyst Greggory Warren says Abel spoke up more on Saturday, allowing shareholders to see some genius Berkshire management boasts about.

Abel twisted Munger’s famed “I have nothing to add” statement by frequently beginning his answers Saturday with “The only thing I would add.”

Warren Buffett Says AI May Be Better For Scammers Than Society. And He’s Seen How

“Greg’s a rock star,” stated Chris Bloomstran, head of Semper Augustus Investment Group. The bench is deep. He won’t be in the same mood at the meeting, but I believe we all come here every year as a reminder to remain logical.”

Buffett made it obvious that Abel would be Berkshire’s next CEO, but he stated on Saturday that he had altered his mind about how the company’s investment portfolio should be managed. He has previously stated that it would fall to two investment managers who now control tiny portions of the fund. On Saturday, Buffett approved Abel for the position, which includes managing the running businesses and potential acquisitions.

“He understands the business well. “If you understand business, you understand common stocks,” Buffett stated. The board will ultimately decide, but the billionaire has threatened to come back and haunt them if they try something different.

Buffett believes Berkshire’s arrangement of having all non-insurance companies report to Abel, and insurers report to Jain is effective. He no longer receives many calls from management since they rely on Abel and Jain for assistance.

“This place would work extremely well the next day if something happened to me,” Buffett stated in an interview.

Nonetheless, Buffett’s closing remark was the biggest applause line of the day: “I not only hope that you come next year, but that I come next year.”

SOURCE – (AP)