The Seattle-based Starbucks Corporation is grappling with a substantial market value loss of nearly $11 billion, triggered by calls for a boycott and protests. The decline in value has been a result of a significant drop in shares, falling by 8.96% since the November 16 Red Cup Day promotion, as reported by PTI.
The continuous decline in stocks over 12 sessions has brought the current share value to approximately $95.80, down from its yearly high of $115. Analysts attribute this downturn to sluggish sales and a tepid response to the holiday season’s offerings.
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Starbucks has been facing challenges in maintaining its brand reputation amid allegations and calls for a boycott related to divisive global issues. The company has denied any wrongdoing in the scenarios but is now contending with the financial impact of the boycott, particularly in certain regions.
A recent wave of boycotts against Starbucks is part of a larger movement targeting global brands over their alleged support for Israel. In response to the economic strain caused by the ongoing global boycott, Starbucks in Egypt has taken measures to cut expenses, including laying off workers in late November.
The repercussions of the boycott have led to significant challenges for Starbucks, prompting strategic responses such as expense reductions to navigate the economic impact and maintain stability in the wake of widespread protests and consumer backlash. The company will need to address these challenges carefully to regain market confidence and recover from the substantial loss in market value.
