SHENZHEN, CHINA – 2020/10/05: Chinese coffee shop chain Luckin Coffee logo seen at a store. (Photo by Alex Tai/SOPA Images/LightRocket via Getty Images)
Sopa Images | Lightrocket | Getty Images
Chinese coffee giant Luckin Coffee hit 10,000 stores in China in June, surpassing Starbucks as the largest coffee chain brand in the country following rapid nationwide expansion this year.
Founded in 2017, Luckin Coffee burst onto the Chinese coffee scene to challenge Starbucks through affordable coffee options and mobile ordering. China is Starbucks’ second-largest market after the U.S.
“They are very aggressive in store expansion and in China, it is very common to buy a drink from Luckin for $2 or less after heavy discounts,” said Jianggan Li, founder and CEO of tech research company Momentum Works.
Luckin stores are also of a smaller format compared to Starbucks, which has much larger stores.
Rahul Maheshwari
Early-stage investor
China is traditionally a tea-drinking market, but over the last few years, coffee sales have been increasing steadily, especially in urban areas and among younger professionals.
China’s overall coffee sales will rise at an 8.7% compound annual growth rate (CAGR) from 2022–2027, according to analytics firm GlobalData. CAGR is a measure of investment returns, which takes into account what an investment yields at an annual rate over a specified period.
Aggressive expansion
In the quarter ended June 30, Luckin Coffee opened 1,485 new stores, averaging 16.5 new stores daily. Of the 10,829 stores in China, 7,181 are self-operated and 3,648 are partnership stores, according to the company’s earnings transcript.
The Chinese coffee chain expanded to Singapore in March in its first international foray and has opened 14 stores in the city-state so far, according to a CNBC check.
Cumulative transacting customers surpassed 170 million, while average monthly transacting customers reached 43.07 million in the second quarter, according to the company.
“Luckin was able to expand so fast because of its operating model — which includes self-operated stores and franchises,” said Li of Momentum Works.
Meanwhile, Starbucks’ stores worldwide are company-owned and the American coffee chain does not franchise operations, according to its website. Instead, it sells licenses to operate. In the quarter ended July 2, the company opened 588 new stores — about 40% of Luckin’s count.
Vivian Leung, an office worker residing in Guangzhou, said that there are at least two Luckin Coffee outlets within 50 meters from her apartment.
TIANJIN, CHINA – 2023/07/24: Customers are waiting in front of the counter.
Zhang Peng | Lightrocket | Getty Images
“Franchising unlocks very fast growth because you don’t have to put that amount of capital. Otherwise you will always be limited from growth. The density of Luckin stores is so high where there’s a store in almost every neighborhood,” said Rahul Maheshwari, an early-stage investor in Asia. He previously worked in Beijing at a Chinese venture capital firm and as a general manager with a Chinese app.
Luckin found mass market appeal. Price wise, it is already differentiated from Starbucks. Quantity wise, it’s still better, compared to many of the low end brands, said Li of Momentum Works.
“Luckin stores are also of a smaller format compared to Starbucks, which has much larger stores,” said Maheshwari.
Luckin found mass market appeal. Price wise, it is already differentiated from Starbucks. Quantity wise, it’s still better, compared to many of the low end brands.
Jianggan Li
Founder and CEO at Momentum Works
“As you can imagine, the asset-heavy model is expensive to operate and slow to scale,” said Momentum Works in a report.
Luckin operates a grab-and-go model, where customers order from the app and pick up their orders at the store, unlike Starbucks which offers a cozy environment for people to work and socialize.
As a result, Luckin has lower operating costs and can “break even within a year,” said Maheshwari.
Mass market appeal
Luckin and Starbucks have different pricing strategies.
A cup of coffee from Luckin costs 10 to 20 yuan, or about $1.40 to $2.75. That’s because Luckin offers heavy discounts and offers. Meanwhile, a cup of coffee from Starbucks is priced at 30 yuan or more — that’s at least $4.10.
“Luckin found mass market appeal. Price wise, it is already differentiated from Starbucks. Quality wise, it’s still better, compared to many of the low end brands,” said Li.
According to Guangzhou resident Leung, said that Luckin Coffee is “delicious and affordable.”
Luckin is also looking to collaboration and partnerships to raise the profile of its brand.
Last Tuesday, the company launched a new drink with Kweichow Moutai, a Chinese liquor maker famed for its “baijiu,” or white liquor made from rice grains.
Moutai, sometimes called maotai, is a premium distilled Chinese liquor and has been dubbed the “national liquor of China.”
Moutai topped the list of spirits brands with a value of $42.9 billion, according to a 2022 study by valuation consultancy Brand Finance.
Shawn Yang, managing director at Blue Lotus Research Institute, said it was a strategic move to “offer premium products to offset the sense of cheapness from 9.9 yuan per cup.”
“Luckin [extended its] customer base by leveraging the influence of legacy Chinese brands, including Moutai and Coconut Palm,” said Yang in a report.
Other localized hits with the Chinese market include brown sugar boba latte, as well as cheese latte and coconut latte.
“Luckin Coffee has played an important role in deepening the coffee market in China by introducing products which would suit the Chinese customer,” said Maheshwari in a recent blog post.
Elon Musk looks on as U.S. President Donald Trump meets South African President Cyril Ramaphosa in the Oval Office of the White House in Washington, D.C., U.S., May 21, 2025.
Kevin Lamarque | Reuters
The Elon Musk-owned social media platform X experienced a brief outage on Saturday morning, with tens of thousands of users reportedly unable to use the site.
About 25,000 users reported issues with the platform, according to the analytics platform Downdetector, which gathers data from users to monitor issues with various platforms.
Roughly 21,000 users reported issues just after 8:30 a.m. ET, per the analytics platform.
The issues appeared to be largely resolved by around 9:55 a.m., when about 2,000 users were reporting issues with the platform.
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X did not immediately respond to CNBC’s request for comment. Additional information on the outage was not available.
Musk, the billionaire owner of SpaceX and Tesla, acquired X, formerly known as Twitter in 2022.
The site has had a number of widespread outages since the acquisition.
Artificial intelligence robot looking at futuristic digital data display.
Yuichiro Chino | Moment | Getty Images
Businesses are turning to artificial intelligence tools to help them navigate real-world turbulence in global trade.
Several tech firms told CNBC say they’re deploying the nascent technology to visualize businesses’ global supply chains — from the materials that are used to form products, to where those goods are being shipped from — and understand how they’re affected by U.S. President Donald Trump’s reciprocal tariffs.
Last week, Salesforce said it had developed a new import specialist AI agent that can “instantly process changes for all 20,000 product categories in the U.S. customs system and then take action on them” as needed, to help navigate changes to tariff systems.
Engineers at the U.S. software giant used the Harmonized Tariff Schedule, a 4,400-page document of tariffs on goods imported to the U.S., to inform answers generated by the agent.
“The sheer pace and complexity of global tariff changes make it nearly impossible for most businesses to keep up manually,” Eric Loeb, executive vice president of government affairs at Salesforce, told CNBC. “In the past, companies might have relied on small teams of in-house experts to keep pace.”
Firms say that AI systems are enabling them to take decisions on adjustments to their global supply chains much faster.
Andrew Bell, chief product officer of supply chain management software firm Kinaxis, said that manufacturers and distributors looking to inform their response to tariffs are using his firm’s machine learning technology to assess their products and the materials that go into them, as well as external signals like news articles and macroeconomic data.
“With that information, we can start doing some of those simulations of, here is a particular part that is in your build material that has a significant tariff. If you switched to using this other part instead, what would the impact be overall?” Bell told CNBC.
‘AI’s moment to shine’
Trump’s tariffs list — which covers dozens of countries — has forced companies to rethink their supply chains and pricing, with the likes of Walmart and Nikealready raising prices on some products. The U.S. imported about $3.3 trillion of goods in 2024, according to census data.
Uncertainty from the U.S. tariff measures “actually probably presents AI’s moment to shine,” Zack Kass, a futurist and former head of OpenAI’s go-to-market strategy, told CNBC’s Silvia Amaro at the Ambrosetti Forum in Italy last month.
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“If you wonder how hard things could get without AI vis-a-vis automation, and what would happen in a world where you can’t just employ a bunch of people overnight, AI presents this alternative proposal,” he added.
Nagendra Bandaru, managing partner and global head of technology services at Indian IT giant Wipro, said clients are using the company’s agentic AI solutions “to pivot supplier strategies, adjust trade lanes, and manage duty exposure dynamically as policy landscapes evolve.”
Wipro says it uses a range of AI systems — both proprietary and supplied by third parties — from large language models to traditional machine learning and computer vision techniques to inspect physical assets in cross-border transit.
‘Not a silver bullet’
While it preferred to keep company names confidential, Wipro said that firms using its AI products to navigate Trump’s tariffs range from a Fortune 500 electronics manufacturer with factories in Asia to an automotive parts supplier exporting to Europe and North America.
“AI is a powerful enabler — but not a silver bullet,” Bandaru told CNBC. “It doesn’t replace trade policy strategy, it enhances it by transforming global trade from a reactive challenge into a proactive, data-driven advantage.”
AI was already a key investment priority for global firms prior to Trump’s sweeping tariff announcements on April. Nearly three-quarters of business leaders ranked AI and generative AI in their top three technologies for investment in 2025, according to a report by Capgemini published in January.
“There are a number of ways AI can assist companies dealing with the tariffs and resulting uncertainty. But any AI solution’s success will be predicated on the quality of the data it has access to,” Ajay Agarwal, partner at Bain Capital Ventures, told CNBC.
The venture capitalist said that one of his portfolio companies, FourKites, uses supply chain network data with AI to help firms understand the logistics impacts of adjusting suppliers due to tariffs.
“They are working with a number of Fortune 500 companies to leverage their agents for freight and ocean to provide this level of visibility and intelligence,” Agarwal said.
“Switching suppliers may reduce tariffs costs, but might increase lead times and transportation costs,” he added. “In addition, the volatility of the tariffs [has] severely impacted the rates and capacity available in both the ocean and the domestic freight networks.”
A Zoox autonomous robotaxi in San Francisco, California, US, on Wednesday, Dec. 4, 2024.
David Paul Morris | Bloomberg | Getty Images
Amazon‘s Zoox robotaxi unit issued a voluntary recall of its software for the second time in a month following a recent crash in San Francisco.
On May 8, an unoccupied Zoox robotaxi was turning at low speed when it was struck by an electric scooter rider after braking to yield at an intersection. The person on the scooter declined medical attention after sustaining minor injuries as a result of the collision, Zoox said.
“The Zoox vehicle was stopped at the time of contact,” the company said in a blog post. “The e-scooterist fell to the ground directly next to the vehicle. The robotaxi then began to move and stopped after completing the turn, but did not make further contact with the e-scooterist.”
Zoox said it submitted a voluntary software recall report to the National Highway Traffic Safety Administration on Thursday.
A Zoox spokesperson said the notice should be published on the NHTSA website early next week. The recall affected 270 vehicles, the spokesperson said.
The NHTSA said in a statement it had received the recall notice and that the agency “advises road users to be cautious in the vicinity of vehicles because drivers may incorrectly predict the travel path of a cyclist or scooter rider or come to an unexpected stop.”
If an autonomous vehicle continues to move after contact with any nearby vulnerable road user, it risks causing harm or further harm. In the AV industry, General Motors-backed Cruise exited the robotaxi business after a collision in which one of its vehicles injured a pedestrian who had been struck by a human-driven car and was then rolled over by the Cruise AV.
Zoox’s May incident comes roughly two weeks after the company announced a separate voluntary software recall following a recent Las Vegas crash. In that incident, an unoccupied Zoox robotaxi collided with a passenger vehicle, resulting in minor damage to both vehicles.
The company issued a software recall for 270 of its robotaxis in order to address a defect with its automated driving system that could cause it to inaccurately predict the movement of another car, increasing the “risk of a crash.”
Amazon acquired Zoox in 2020 for more than $1 billion, announcing at the time that the deal would help bring the self-driving technology company’s “vision for autonomous ride-hailing to reality.”
While Zoox is in a testing and development stage with its AVs on public roads in the U.S., Alphabet’s Waymo is already operating commercial, driverless ride-hailing services in Phoenix, San Francisco, Los Angeles and Austin, Texas, and is ramping up in Atlanta.
Teslais promising it will launch its long-delayed robotaxis in Austin next month, and, if all goes well, plans to expand after that to San Francisco, Los Angeles and San Antonio, Texas.