Starbucks recently hiked the cost of its coffee an average of 9¢ a cup—the seventh bump up since 1997. With a faltering stock price and learnings lagging after 15 years of solid growth, BusinessWeek wonders whether the premium coffee purveyor may have finally maxed out the market for the luxury latte.
Starbucks today announced a 9% rise in its 3Q earnings, to 21¢ a share. But same-store sales, a key measure, rose a modest 4%. And competition is up—Dunkin' Donuts and McDonalds have both made aggressive moves to get into the game—and new customers Starbucks needs to grow are likely to be more budget conscious than loyalists.