Starbucks Unveils AI Barista, Boosts Shares Amid Labor Disputes

Starbucks is increasingly using AI and customer data to personalize promotions, offering fewer deals to frequent buyers who appear less likely to be swayed by discounts, raising concerns about loyalty programs potentially penalizing their most loyal customers. The company is also experimenting with AI-driven tools like the "AI barista," designed to predict customer orders before arrival, aiming to assist rather than replace workers, though this development has sparked pushback from Starbucks Workers United due to concerns over labor practices. Despite facing store traffic challenges and competitive pressures, particularly in China, Starbucks has announced a $1 billion restructuring plan including store closures and layoffs to improve operational efficiency and profitability, while also increasing its quarterly dividend. Investor sentiment has been mixed, with shares declining over recent months but some bullish outlooks based on the company's long-term growth initiatives and operational upgrades. Additionally, Starbucks is testing a traditional buy-nine-get-one-free rewards program called Coffee Loop, though it faces internal labor tensions highlighted by a controversial firing related to a pride flag incident. Overall, Starbucks balances innovation and restructuring amidst labor disputes and market uncertainties as it seeks to maintain growth and shareholder value.