Watan-The losses incurred by Starbucks due to the boycott in the aftermath of the Israeli war on Gaza have reached approximately $11 billion.
According to the American magazine “Newsweek,” the boycott campaigns and employee strikes, driven by demands for improved working conditions and wages, coupled with a decline in interest in promotional offers, have led to a market capitalization drop of $10.98 billion for the company. This confirms that recent weeks have been tumultuous for the company.
“Starbucks” Faces Future Challenges
Quoting an analyst in the coffee sector, it is evident that while conflicts appear multifaceted for the “Starbucks” chain, these adverse effects on the company’s plans indicate challenges for its future.
It is reported that the stock market has significantly impacted “Starbucks” at a time when the company is grappling with complex societal issues. This has led investors to divest from the company’s stocks, causing its shares to experience the longest series of losses since its initial public offering in 1992.
Decline in Starbucks Stocks
Since November 16th, the stocks of Starbucks have decreased by 8.96%, equivalent to a loss of nearly $11 billion. This decline is attributed to reports of slowing sales and a weakened response to holiday season promotions.
The magazine noted that Starbucks found itself in a predicament following a tweet from the workers’ union expressing solidarity with Palestinians. It suggested that the company’s actions against the union and its legal battles have extended their impact to its business operations.
Starbucks’ stock had fallen by approximately 11% from $107.21 on November 16th to $95.54 by the end of trading on December 5th. Consequently, the stock has lost 9.5% of its overall value since November 16th, amounting to nearly $12 billion.
Loss of Starbucks Market Capitalization
Since November 16th, Starbucks has witnessed a market capitalization loss of $11.3 billion, with the total value dropping from $123.22 billion to the current $111.94 billion.
Despite an 8% growth in its fourth-quarter financials, data did not conceal a slowdown in the global coffee company’s sales last month, according to J.P. Morgan analyst John Ivankoe.
Starbucks Faces Backlash Following Lawsuit Against Union
Starbucks’ legal action against the union has sparked a social media campaign against the coffee giant. The company’s lawsuit against the union led to protests by its members at over 200 branches in the United States, causing disruptions to the company’s normal operations.
After Starbucks filed a lawsuit against its own workers’ union, accusing them of supporting Palestine, social media campaigns calling for a boycott of the renowned American coffee chain have gained momentum in the Arab world.