Starbucks unveils single-cup coffee brewer

Matt Andrejczak
March 8, 2012
MarketWatch

Starbucks Corp.announced Thursday it will sell its own single-serve coffee brewer later this year, a move that threatens Green Mountain Coffee Roasters Inc, which makes the top-selling Keurig brewer and the K-Cups used in them.

Green Mountain shares tumbled 19% in late trading on the news.

Starbucks said its brewer, called Verismo, will make coffee, espresso, latte and Americano drinks. Verismo will be available by the 2012 holiday season and be sold over the Internet, as well as at certain Starbucks stores and retailers.

The Seattle-based company said it’s developed Verismo in a partnership with German-based Krüger GmbH & Co. KG. The system will be paired with Starbucks coffee and milk pods.

In a statement, Starbucks didn’t give pricing information or indicate how this would affect its current relationship with Green Mountain, which this past fall began selling K-Cups with Starbucks coffee. In the first two months, Starbucks shipped more than 100 million of its branded K-Cup packs.

The single-cup coffee brewer market is growing fast, and Starbucks Chief Executive Howard Schultz has been seeking to make a strong push into it.

“We have long believed that the biggest prize within the segment is a high-pressure system that would give us the opportunity to deliver Starbucks-quality espresso beverages at home and at work for customers who desire the Starbucks espresso experience outside of our stores,” he said in the statement.

In late trades, Starbucks rose 3% to $52.13. Earlier Thursday, the stock steamed past the $50 mark for the first time ever on a split-adjusted basis.