On September 4, 2026, the Wall Street Journal reported that Starbucks Corporation (NASDAQ:SBUX)' longtime chai latte devotees have turned against the company's reformulated recipe, introduced in March. It reduced sweetener and shifted from a pre-made concentrate to a new base with just two grams of sugar. Customers have signed petitions, flooded Starbucks' corporate lines, and taken to Reddit and store review sites demanding the original formula back.
Starbucks says the change gives customers more control over sweetness and has introduced new variations like Mango Cream Chai and Pumpkin Cream Chai. Starbucks Corporation (NASDAQ:SBUX)' broader turnaround remains intact despite the backlash over its chai reformulation. Global comparable sales increased 7.9% in fiscal Q3, with comparable transactions rising 4.2%.
The company raised its fiscal 2026 adjusted EPS guidance to $2.55-$2.65 from $2.25-$2.45. Stronger customer traffic and higher earnings give investors evidence that one unpopular menu change has not derailed the recovery. The chai backlash appears concentrated among loyal customers of one product rather than across Starbucks' broader customer base.
The business introduced the new chai formula as part of a personalization strategy. Customers can customize sweetness and other ingredients. If Starbucks keeps transaction growth across its wider menu, the business could improve its product economics without materially damaging overall customer demand.
Starbucks is improving profitability while it executes its turnaround. Non-GAAP operating margin expanded 430 basis points year over year to 14.4% in fiscal Q3, while North America revenue increased 7% to $7.4 billion. These results give investors evidence that the company can improve margins and sales even as it experiments with its menu and customer experience.
The chai backlash could damage customer loyalty at a sensitive point in Starbucks Corporation (NASDAQ:SBUX)' turnaround. Longtime chai customers have criticized the new formula, signed petitions, and contacted the company. Some customers have shifted toward homemade alternatives.
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