Coffee is king in Starbucks.
The chain is famous for selling premium beverages such as iced coffee and iced tea.
But a new study from brokerage firm J.P. Morgan Chase & Co. says that the beverage giant has a tough time keeping up with demand for iced matchas.
In fact, Starbucks recently saw its matcha sales drop more than half compared to the same period last year, J.M. Smucker reported Wednesday in The Wall Street Journal.
“We believe Starbucks is losing ground in the premium beverage category,” the report said.
“This could be a sign that customers are not willing to spend more to get matcha.”
The report comes as Starbucks is facing criticism from competitors over its pricing.
At the company’s flagship stores in New York, customers can spend as little as $2.50 on matcha lattes.
The chain’s flagship in Chicago is charging $2 for a $2 cup of iced latte.
Starbucks also announced plans to launch a limited-time offer of ices with the purchase of a $10 coffee cup, a perk that is already available in a number of locations.