Philz Coffee removes Pride flags, says it seeks a more 'inclusive' experience

Philz Coffee is facing backlash after announcing it would remove all Pride flags from all its stores to offer a “more consistent, inclusive experience.” The chain has six Chicago-area locations.

The decision has sparked outrage from some employees and customers, who say the LGBTQ+ community is intrinsically linked to the coffeehouse's branding, which specializes in customized blends.

Friday, Philz CEO Mahesh Sadarangani issued a confidential letter to employees. "We hear and deeply understand that we did not handle changes to store decor as well as we should have, especially as true allies to the community," the letter stated.

Philz has historically been supportive of the LGBTQ+ community and will still sell a “Unity Collection” of merchandise and coffee to support queer organizations since 2022. The letter noted Philz will continue to donate to the same LGBTQIA+ organizations as last year.

The San Francisco-based chain operates about 75 locations nationwide, most in California, with six in the Chicago area — in Lincoln Park, Old Town, River North, Wicker Park and Hyde Park and Evanston.

Sadarangani said in a statement the decision was made to make everyone feel “welcome and safe.”

“Our longstanding support of the LGBTQIA+ community is unchanged,” said Sadarangani, CEO since 2021. “We are working toward creating a more consistent, inclusive experience across all our stores, including removing a variety of flags and other decor. This is a change in how our stores look, not in who we are. ”

Philz, founded in 2003, has built a reputation as a friend of the queer community. Pride flags decorated locations year-round, and the company hosts an annual celebration and fundraisers for LGBTQ+ causes, including donating to scholarships.

Of the Chicago area stores, three displayed Pride flags, according to the company.

But now the flags are gone, and staff have been urged not to speak on the matter when asked.

Two Philz employees spoke to the Sun-Times but asked that their names not be published, fearing for their jobs.

One employee told the Sun-Times that early last week, baristas at the Chicago-area locations noticed the flags were gone without explanation.

“Many Philz employees are queer, and this decision hurt us immensely,” the employee said. “The vibe and atmosphere of the store have gone downhill.”

The employee was told if managers did not take down the flags immediately, their jobs would be at stake.

Another employee told the Sun-Times all flags, including Chicago-specific and Black Lives Matter flags, were removed.

Both employees said the company has moved away from its inclusive roots after its 2025 acquisition by private equity firm Freeman Spogli.

The confidential letter from Sadarangani said the company wants an inclusive experience that reflects the community — which may include "removing a variety of flags and other decor."

"Some of our team members have shared that those changes felt personal," he said in the letter. "I understand that, and I take full responsibility for not communicating or executing this change in a way that honored the trust you place in this company every day."

The actions of Philz Coffee mirror recent corporate trends, with companies pulling back DEI initiatives amid oppostion from President Donald Trump. But in the letter, Sadarangani stressed a DEIB committee was still in place.

A petition started earlier this week by a Philz Coffee Baristas group reached over 4,500 signatures as of Friday.