Starbucks Corp. SBUX has decided to discontinue its olive oil-infused drinks, known as “Oleato,” from its US and Canada menus. This decision is part of the company’s strategy to simplify its menu, which has been described as “overly complex” by the new CEO, Brian Niccol.
What Happened: The Oleato drinks, which were introduced less than a year ago, will be removed from Starbucks’ menus in the U.S. and Canada starting in early November, as reported by CNN on Tuesday, citing a source familiar with the company's plans.
This move is part of Starbucks’ broader plan to streamline its menu, a decision that was made before Niccol took over as CEO.
The olive oil-infused drinks were the brainchild of former CEO Howard Schultz, who got the idea after meeting an olive oil producer. The drinks were met with mixed reviews from consumers and the media, with some even reporting stomach issues after consuming them.
Starbucks did not immediately respond to Benzinga's request for comment.
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Why It Matters: This decision comes amid a series of challenges for Starbucks. The company recently reported weak preliminary results for the fourth quarter, leading to a decline in its stock value.
Starbucks is also facing increased competition, with its Chinese rival, Luckin Coffee, reportedly planning a U.S. comeback with low-cost beverages.
Despite these challenges, analysts remain optimistic about Niccol’s leadership and his ability to address the company’s key issues.
Price Action: Starbucks’ stock closed at $97.39 on Tuesday, down 0.64%. In pre-market trading, the stock is down 0.24%. Year to date, Starbucks has seen a gain of 3.97%, according to data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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