Starbucks Malaysia operator lost RM292M in a year — a boycott it could not control

Berjaya Food, the franchise operator of Starbucks stores in Malaysia, posted a record net loss of RM292 million (approx. US$69 million) for the financial year ending June 2025, more than tripling the RM91.5 million loss of the prior year. Revenue fell 36% to RM477 million as consumer traffic collapsed.

The losses were driven by a prolonged consumer boycott linked to the Gaza conflict. Malaysian and Indonesian consumers associated US fast-food and coffee chains with perceived Western support for Israel, leading to sustained customer avoidance. The boycott stretched across five consecutive quarters, with no sign of recovery.

Berjaya Food was forced to downsize its Starbucks outlet network, booking impairment charges of RM152.8 million — nearly six times the prior year — on stores, equipment, and lease assets. The company had previously been a profitable operator, posting RM103.4 million in net profit before the boycott began.

Starbucks CEO Brian Niccol publicly defended the brand, saying boycott claims were inaccurate, but the on-the-ground reality in Malaysia was clear: consumers had made up their minds. Berjaya Food's record losses illustrated how geopolitical conflicts outside a company's control can destroy the financials of a local franchise operator.