Jim Cramer on Wednesday blasted Starbucks CEO Laxman Narasimhan in a CNBC interview after the coffee giant delivered a terrible quarter and a guidance miss . With Starbucks shares down more than 15% following Tuesday evening’s quarterly release and conference call, Jim asked Narasimhan in an interview on CNBC why the Club should hold the stock for the portfolio for another quarter. Narasimhan responded, in part, by saying: “It is true we had a tough quarter, but we have an action plan against that. … We are completely focused on a plan that is not business as usual to reverse some of the trends that we have seen. And we have demand that we can meet. We have products in the pipeline that are strong. … I think what you’ve seen is real progress as a business. If you look at the growth in core categories.” The CEO said taken all together, the company sees a “foundation of a business that is really strong.” Following contentious exchanges with Narasimhan on ” Squawk on the Street ,” Jim said, “I am stunned.” He added, “I am distressed about this situation even knowing Mr. Narasimhan has an action plan.” Jim said it’s a matter of trust, saying the CEO should not have tried to paint a picture of a company that can build on strengths to right the ship. The message from Narasimhan to Jim on TV: the quarter was bad due to China’s choppiness and bad weather in the U.S. The CEO announced an action plan centered around winning more business from the occasional Starbucks customer. Jim questioned Narasimhan at every turn and strongly asked why Starbucks was still moving forward with expansion plans. The CEO pointed to growth in markets such as Latin America and Japan. He said the U.S. business of Starbucks is holding share. Jim said the read-throughs from Tim Horton’s and McDonald’s and Dunkin’ Donuts suggested otherwise. Narasimhan said loyal Starbucks customers are engaged a despite quarter-over-quarter decline in loyalty program users and long wait times to complete transactions online. The CEO said wait times on the app are improving. Jim’s Charitable Trust, the portfolio used for the CNBC Investing Club , owns shares of Starbucks. CNBC reached out to Starbucks for comment on the interview.
Jim Cramer blasts Starbucks CEO in a CNBC interview after horrible quarter: ‘I am stunned’
