Seattle-based Starbucks Corporation has encountered a substantial financial setback following a tumultuous period marked by boycott calls and protests.
Since the November 16 Red Cup Day promotion, the company’s shares have plummeted by 8.96%, resulting in a staggering loss of approximately $11 billion in market value within a mere 19-day period, as reported by PTI.
Factors Contributing to Decline:
Analysts attribute this decline to sluggish sales and a tepid response to the holiday season’s offerings, which have weighed heavily on the company’s performance.
The stocks have experienced a continuous decline over 12 consecutive sessions, with current rates hovering around $95.80 per share, significantly down from its annual peak of $115.
Brand Reputation Challenges and Denial of Wrongdoing:
Despite denying any wrongdoing in the controversies, Starbucks confronts the challenging task of safeguarding its brand reputation amid contentious global issues.
The recent wave of boycotts against Starbucks is part of a broader movement targeting global brands over alleged ties to Israel, further exacerbating the company’s difficulties.
Impact and Response in Egypt:
The financial ramifications of the boycott have reverberated, particularly in Starbucks’ operations in Egypt.
In response to the economic strain induced by the ongoing global boycott, the company’s Egypt division implemented cost-cutting measures, including worker layoffs in late November, as a strategic move to mitigate the challenges posed by the boycott’s repercussions.
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