Core Viewpoint - Starbucks has announced a strategic partnership with Chinese alternative asset management firm Boyu Capital to establish a joint venture for its retail operations in China, indicating a significant shift in its business strategy in the region [1][2]. Group 1: Joint Venture Details - The joint venture will see Boyu holding up to 60% equity, while Starbucks retains 40% and continues to own and license its brand and intellectual property to the new entity [1]. - The enterprise value of the joint venture is approximately $4 billion, excluding cash and debt, with Boyu acquiring corresponding equity [1]. - Starbucks anticipates that the total value of its retail business in China will exceed $13 billion, which includes the value from the equity transfer to Boyu, retained equity in the joint venture, and ongoing licensing revenue over the next decade or longer [1]. Group 2: Market Context and Strategic Moves - Rumors about Starbucks potentially selling its China operations have circulated for some time, with a valuation of $5 to $6 billion reported in June 2024 [2]. - The company is actively seeking strategic partners that share its vision and values, evaluating over 20 interested institutions while aiming to retain a significant portion of its equity in the Chinese market [3]. - In response to intense competition in China, Starbucks has implemented various strategies, including price reductions on non-coffee products and expanding its presence in lower-tier markets [3]. Group 3: Store Expansion and Performance - In the fourth quarter, Starbucks opened 183 new stores in China, entering 47 county-level markets, with a total of 415 net new stores projected for the fiscal year 2025 [4]. - By the end of fiscal year 2025, Starbucks will have opened 8,011 stores across 1,091 county-level cities, with new stores maintaining a high level of profitability and contributing above-average same-store sales [4].

Core Insights - Starbucks has announced a strategic partnership with Boyu Capital to establish a joint venture for its retail operations in China, marking a new chapter in its 26-year history in the market [2][3] - The joint venture will allow Boyu to hold up to 60% equity, while Starbucks retains 40% and continues to own and license its brand and intellectual property [2] - The estimated total value of Starbucks' retail business in China is projected to exceed $13 billion, comprising the equity transferred to Boyu, the retained equity value, and ongoing licensing revenue [2] Company Strategy - The collaboration aims to enhance customer experience, accelerate beverage and digital innovation, and expand into new cities and regions, deepening emotional connections with consumers [3][4] - The new joint venture will be headquartered in Shanghai and manage approximately 8,000 Starbucks stores in China, with a goal to expand the store count to 20,000 in the future [3][4] Market Position - Starbucks has established a strong high-end brand image in China, creating deep emotional ties with consumers over the past 26 years [4] - The partnership is expected to leverage Boyu's local market insights and Starbucks' global leadership in the coffee industry to drive growth and deliver exceptional coffee experiences to a broader Chinese consumer base [4] Company Background - Starbucks has over 40,000 stores worldwide and is recognized as a leading specialty coffee roaster and retailer, committed to ethical sourcing and high-quality Arabica coffee [5] - Boyu Capital, founded in 2011, is an alternative asset management firm with a diversified investment platform, focusing on private equity, public markets, infrastructure, and venture capital [5]

Core Insights - Starbucks Corp. has agreed to sell a 60% stake in its China business to Boyu Capital for $4 billion to enhance its operations in the country [1][2] - The partnership aims to navigate challenges posed by local competitors and changing consumer preferences in China [2][3] Company Strategy - Starbucks has approximately 8,000 stores in China and aims to grow this number to over 20,000 in the future [5] - The company has faced increased competition from domestic brands like Luckin Coffee, which offers lower-priced alternatives [3] - Recent strategies include launching free "study rooms" and expanding the menu to include more local preferences, such as sugar-free options and teas [7] Financial Performance - In the fourth quarter, comparable store sales in China increased by 2%, marking the first positive growth in over a year [5] - The estimated total value of Starbucks' retail operations in China is projected to exceed $13 billion [5] - Starbucks shares saw a slight increase of less than 1% in after-hours trading, but the stock has fallen approximately 11% this year [6] Investment Background - Boyu Capital, established in 2011, focuses on private equity investments across various sectors, including consumer and retail [4] - The decision to partner with Boyu Capital follows a competitive bidding process where five potential suitors were considered [3]

Core Viewpoint - Starbucks has entered a strategic partnership with Boyu Capital to establish a joint venture for retail operations in China, aiming to expand its market presence significantly. Group 1: Joint Venture Details - The joint venture will see Boyu Capital holding up to 60% equity, while Starbucks retains 40% and continues to own and license its brand and intellectual property [5][6] - The enterprise value of the joint venture is approximately $4 billion, excluding cash and debt, with Starbucks estimating its total retail business value in China to exceed $13 billion [5][6] - The new joint venture will be headquartered in Shanghai and manage around 8,000 existing Starbucks stores in China, with plans to expand to 20,000 stores in the future [6] Group 2: Strategic Intent and Market Insights - Starbucks CEO Brian Niccol emphasized that Boyu's local market expertise will accelerate Starbucks' growth in China, particularly in smaller cities and emerging regions [6] - Boyu Capital's partner, Huang Yuzheng, highlighted the opportunity to innovate and localize the Starbucks experience for Chinese consumers, leveraging the brand's strong market presence [6] - Starbucks' China CEO, Liu Wenjuan, stated that this partnership will unlock significant market potential and enhance the coffee experience for Chinese customers [6] Group 3: North America Operations - In contrast, Starbucks plans to close about 1% of its stores in the U.S. and Canada, reducing the total number to approximately 18,300 by the end of the fiscal year [7][8] - The closures are part of a new strategic plan aimed at revitalizing performance, as sales have declined for six consecutive quarters [8] - The closures will primarily affect stores that only offer takeout, as the company shifts focus towards providing a comfortable dine-in experience [8]

Core Viewpoint - Starbucks has finalized a strategic partnership with Chinese alternative asset management firm Boyu Capital to establish a joint venture for its retail operations in China, with Boyu holding up to 60% equity and Starbucks retaining 40% [1][3][4]. Group 1: Joint Venture Details - The joint venture will be headquartered in Shanghai and manage approximately 8,000 Starbucks stores across China, with plans to expand to 20,000 stores in the future [3]. - The deal values Starbucks' retail business in China at over $13 billion, which includes the equity transferred to Boyu, the retained equity value, and future royalty income [1][4]. - Starbucks CEO Brian Niccol emphasized that Boyu's local market expertise will accelerate Starbucks' expansion, particularly in smaller cities and emerging regions [3]. Group 2: Financial Performance - For the fiscal year ending September 28, 2025, Starbucks China reported a revenue increase of 6% to $831.6 million, with a total annual revenue growth of 5% to $3.105 billion [6]. - The operating profit margin for Starbucks China has remained in double digits, with profits and margins improving for four consecutive quarters [6]. - Same-store sales in China grew by 2%, with transaction volume increasing by 9%, although the average ticket price declined by 7% [9]. Group 3: Market Position and Competition - Starbucks faces increasing competition from local brands like Luckin Coffee, which reported a 47.1% revenue growth in Q2, significantly outpacing Starbucks [11]. - Luckin Coffee has expanded its store count to 26,206, creating a substantial gap in market presence compared to Starbucks [12]. - The competitive landscape indicates that Starbucks is losing its previous dominant position in the Chinese market, necessitating a shift towards localization and partnership with local firms [11][13]. Group 4: Strategic Changes - Starbucks is implementing price adjustments and promotional activities to drive sales, including a price reduction on key products [7][8]. - The company is also enhancing its delivery services, which have seen record sales, contributing to overall revenue growth [8]. - The shift towards a more localized operational approach is seen as essential for Starbucks to maintain its brand identity while adapting to the Chinese market [10][13].

《科创板日报》记者获悉，星巴克咖啡公司宣布与博裕投资达成战略合作，双方将成立合资企业，共同运营星巴克在中国市场的零售业务。 根据协议，博裕将持有合资企业至多60%股权，星巴克保留40%股权，并将继续作为星巴克品牌与知识产权的所有者和授权方，向新成立的合资企业 进行授权。基于约40亿美元（不计现金与债务）的企业价值，博裕将获得其相应权益。 ...

Core Viewpoint - Starbucks has entered a strategic partnership with Boyu Capital to establish a joint venture for its retail operations in China, with Boyu holding up to 60% equity and Starbucks retaining 40% [1][2]. Group 1: Joint Venture Details - The joint venture will be headquartered in Shanghai and will manage approximately 8,000 Starbucks stores across China, with plans to expand to 20,000 stores in the future [2]. - The deal values Starbucks' retail business in China at over $13 billion, which includes the equity transferred to Boyu, the retained equity value, and future royalty income [1][4]. Group 2: Market Position and Growth Potential - Starbucks' CEO Brian Niccol emphasized that Boyu's local market expertise will accelerate Starbucks' expansion, particularly in smaller cities and emerging regions [3]. - Boyu's partner highlighted the strong brand image Starbucks has built in China and the opportunities for more localized experiences [3]. Group 3: Financial Performance - For the fourth quarter of fiscal year 2025, Starbucks China reported a revenue increase of 6% to $831.6 million, with a full-year revenue growth of 5% to $3.105 billion [5]. - The operating profit margin for Starbucks China has remained in double digits, with profits and margins improving for four consecutive quarters [5]. Group 4: Competitive Landscape - Starbucks faces increasing competition from local brands like Luckin Coffee, which reported a 47.1% revenue growth in Q2, significantly outpacing Starbucks [9]. - Luckin Coffee has expanded its store count to 26,206, creating a substantial gap in market presence compared to Starbucks [9]. Group 5: Localization Efforts - Starbucks is shifting towards a more localized operational model, allowing its Chinese team greater autonomy in decision-making [6][10]. - The company has also engaged in partnerships with local platforms like Xiaohongshu and integrated its membership system with Eastern Airlines [6]. Group 6: Cultural Considerations - The challenge for Starbucks lies in maintaining its core cultural values while adapting to the Chinese market, as the company has historically emphasized a customer-centric service culture [10].

此次战略合作开启了星巴克深耕中国市场 26年 后的全新篇章。星巴克享誉全球的品牌影响力、 咖啡专业优势和以人为本的独特伙伴文化,与博 裕对中国消费者的深度理解相结合,双方将携手 共同提升星巴克在中国市场的顾客体验,加速饮 据星巴克披露，新成立的合资企业将继续以上海为总部，管理并运营目前遍布中国市场的8000家星巴克 门店。秉持共同的发展愿景，双方将致力于未来将星巴克在中国的门店规模逐步拓展至20000家。（21 世纪经济报道） 星巴克预计其中国零售业务的总价值将超过 130 亿美元,总价值由三部分构成:向博裕出让合 资企业控股权益所得、星巴克在合资企业中保留 的权益价值,以及未来十年或更长时间内持续支 付给星巴克的授权经营收益。 根据协议，博裕将持有合资企业至多60%股权，星巴克保留40%股权，并将继续作为星巴克品牌与知识 产权的所有者和授权方，向新成立的合资企业进行授权。基于约40亿美元（不计现金与债务）的企业价 值，博裕将获得其相应权益。 星巴克预计其中国零售业务的总价值将超过130亿美元，总价值由三部分构成：向博裕出让合资企业控 股权益所得、星巴克在合资企业中保留的权益价值，以及未来十年或更长时间内持续 ...

Core Insights - Starbucks has announced a strategic partnership with Boyu Capital to establish a joint venture for its retail operations in China, marking a significant shift in its business model in the country after 26 years [1][30] - The total value of Starbucks' retail business in China is projected to exceed $13 billion, equivalent to approximately 92.5 billion RMB [1][4] - The partnership aims to accelerate product and digital innovation, expand into new cities and regions, and deepen emotional connections with customers through localized integration [1][30] Transaction Structure - Boyu Capital will hold up to 60% of the joint venture, while Starbucks retains 40% and continues to own and license its brand and intellectual property [4] - The joint venture is based on an enterprise value of approximately $4 billion, excluding cash and debt, with Starbucks expecting the total value of its Chinese retail business to exceed $13 billion [4][25] - The goal is to expand Starbucks' store count in China to 20,000, up from around 8,000 currently, although no specific timeline has been provided [4][29] Market Context - The partnership comes amid increasing competition in China's coffee market, with local brands like Luckin Coffee gaining market share through competitive pricing and innovative offerings [24] - Starbucks has faced pressure to adapt to changing consumer preferences and the rapid growth of the coffee culture in China, prompting the exploration of strategic partnerships [24][30] - The collaboration with Boyu Capital is seen as a way to leverage local market expertise to enhance Starbucks' growth potential in China [6][30] Historical Background - Starbucks entered the Chinese market in 1999 and initially operated through a franchise model due to foreign investment restrictions, transitioning to a wholly-owned model by 2017 [17][19] - The company has played a significant role in educating the Chinese market about fresh coffee and establishing a high-end coffee brand image [17][19] - Starbucks has invested in local initiatives, including a coffee farmer support center in Yunnan, to enhance its supply chain and community engagement [19][21] Leadership and Future Outlook - Brian Niccol, CEO of Starbucks, emphasized the importance of maintaining a strong brand presence in China and the potential for significant growth in the number of stores [25][27] - The new CEO of Starbucks China, Molly Liu, is focused on driving business recovery and innovation in product offerings and customer service [29] - The partnership with Boyu Capital is expected to open a new chapter for Starbucks in China, reinforcing its commitment to the market [1][30]

Core Viewpoint - Starbucks has finalized a strategic partnership with Boyu Capital to establish a joint venture for its retail operations in China, with Boyu holding up to 60% equity and Starbucks retaining 40% [1][3]. Group 1: Transaction Details - The joint venture is based on an enterprise value of approximately $4 billion, excluding cash and debt, with Boyu acquiring corresponding equity [1]. - Starbucks anticipates that the total value of its retail business in China will exceed $13 billion, comprising the equity transferred to Boyu, the retained equity value, and ongoing licensing revenue over the next decade [1]. - The new joint venture will be headquartered in Shanghai and manage around 8,000 Starbucks stores in China, with plans to expand to 20,000 stores [1]. Group 2: Company Performance - For Q4 FY2025, Starbucks reported total net revenue of $9.569 billion, a year-on-year increase of 5.5%, surpassing market expectations [3]. - The operating profit for the same quarter was $278 million, down 78.7% year-on-year, while the net profit attributable to shareholders was $133 million, down 85.4% [3]. - Starbucks China achieved revenue of $831.6 million in Q4 FY2025, a 6% year-on-year increase, marking four consecutive quarters of growth [3][4]. Group 3: Market Expansion - As of the end of FY2025, Starbucks China had 8,011 stores across 1,091 county-level markets, with 83 new stores opened in Q4 FY2025 and a total of 415 new stores for the fiscal year [4]. - Same-store sales in China grew by 2% year-on-year, with same-store transaction volume increasing by 9%, and store operating profit margins remained in double digits [3]. Group 4: Background and Interest - Reports of Starbucks considering the sale of its China business began circulating in the second half of last year, with various investment firms expressing interest [5]. - By September, Boyu Capital, along with other firms, was identified as a final candidate for the acquisition of Starbucks' China operations, with negotiations concluding by the end of October [5].