Starbucks(NASDAQ:SBUX) stock is rising higher on Wednesday after the company revealed plans for a $1 billion investment.
Starbucks is looking to invest back into its employees and stores with this money. It will use this to increase the pay of employees, offer additional training, as well as upgrade stores. This comes as the call for unionization spreads across the chain’s stores.
So what does this mean for SBUX employees? The company intends to increase its minimum wage to $15 an hour in August. It will also be increasing the pay of its store managers, assistant store managers and shift managers that have been around prior to May 27, reports Yahoo Finance.
Starbucks CEO Howard Schultz said the following about the company’s plans.
“Ordinarily, we would have anticipated and invested ahead of the shifts we’re seeing, but COVID disruptions interfered with our ability to make the required investments in store design, operations, infrastructure, and technology. Going forward, we will be making investments in our partners in business to literally catch up on investments we have not made. And make further investments to position the company ahead of the coming growth curve.”
Starbucks also reported solid earnings with adjusted earnings per share of 59 cents on revenue of $7.64 billion. For comparison, Wall Street was expecting adjusted EPS of 60 cents on revenue of $7.6 billion.
SBUX stock is up 9.83% on Wednesday but is down over 30% since the start of the year.
