Starbucks (NasdaqGS:SBUX) Q1 2026 Earnings call January 28, 2026 08:00 AM ET Company ParticipantsBrian Niccol - Chairman and CEOCatherine Park - VP of Investor RelationsCathy Smith - CFOChris O'Cull - Managing DirectorDavid Palmer - Senior Managing DirectorDavid Tarantino - Director of ResearchJohn Ivankoe - Managing Director of Equity ResearchPeter Saleh - Managing DirectorZach Fadem - Managing DirectorConference Call ParticipantsBrian Harbour - Equity Research AnalystDanilo Gargiulo - Equity Research Anal ...

Starbucks (NasdaqGS:SBUX) Q1 2026 Earnings call January 28, 2026 08:00 AM ET Speaker9Good morning. My name is Daryl, and I will be your conference operator today. I would like to welcome everyone to Starbucks' first quarter fiscal year 2026 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's prepared remarks, there will be a question-and-answer session. If you would like to ask a question, simply press star, then the number 1 on your telephone keypad. If ...

Core Insights - Starbucks is expanding its pilot program by implementing at least one assistant store manager, now termed "coffeehouse coaches," at each domestic location by the end of 2026 [1][2][4] Group 1: Program Implementation - The pilot program involved 62 employees in select locations across the U.S., with positive feedback regarding support and operational efficiency [1][3] - The initiative aims to enhance the customer experience and employee growth opportunities, aligning with the "Back to Starbucks" plan to address declining sales and traffic [2][3] Group 2: Role and Responsibilities - Coffeehouse coaches will focus on leadership, supporting customers, and assisting partners during busy shifts, acting as a resource for real-time coaching [4] - The company plans to hire 90% of its leaders from internal candidates, with nationwide postings for coffeehouse coach positions expected soon [4] Group 3: Broader Strategic Goals - The "Back to Starbucks" plan includes various strategies such as closing underperforming locations, reimagining product offerings, and redesigning the Rewards program [5] - CEO Brian Niccol emphasizes returning to the original third-place environment, enhancing the coffeehouse atmosphere by reintroducing features like the condiment bar and personalizing customer interactions [5]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Financial Performance - Starbucks' global net revenue reached $8.8 billion, a 3% year-over-year increase[3] - The company's global operating margin was 8.2%, a decrease of 450 basis points year-over-year[3] - Diluted net earnings per share (EPS) were $0.41, a 38% year-over-year decrease[3] Sales and Store Growth - Overall comparable store sales decreased by 1%[3] - North America's comparable store sales decreased by 2%[3] - China's comparable store sales remained flat at 0%[3] - The global store count increased by 5% year-over-year, reaching 40,789 stores[3] Strategic Direction - The company is focused on its "Back to Starbucks" plan to improve the business[2] - Starbucks aims to re-introduce the Starbucks experience to the world by focusing on customer service, coffee quality, and community coffeehouses[6, 7, 8] - The company emphasizes its mission to be the premier purveyor of the finest coffee, inspiring and nurturing the human spirit[5]

Core Insights - Starbucks reported disappointing second-quarter fiscal 2025 results, leading to a 9.6% decline in stock price before market open on April 30, although it has since recovered by approximately 6.6% as of May 1 [1][3] Financial Performance - Adjusted earnings per share decreased by 39.7% year over year, from $0.68 to $0.41, missing the Zacks Consensus Estimate of $0.49 by 16.3% [3] - Total revenue increased by 2.3% year over year to $8.76 billion, but fell short of the Zacks Consensus Estimate of $8.79 billion [3] - Global comparable store sales declined by 1% year over year, driven by a 2% decrease in comparable transactions, partially offset by a 1% increase in average tickets [4] Operational Highlights - The company opened 213 net new stores, bringing the total store count to 40,789 [4] - Non-GAAP operating margin contracted by 4.60% to 8.2% due to deleverage and increased labor costs associated with the "Back to Starbucks" initiative [4] Segment Performance - North America segment net revenues were $6.47 billion, up 1% year over year, but operating margin contracted by 6.4% to 11.6% [5] - International segment net revenues increased by 6% year over year to $1.87 billion, with operating margin contracting by 1.7% to 11.6% [5] Strategic Initiatives - CEO Brian Niccol expressed optimism regarding the "Back to Starbucks" plan, which focuses on enhancing atmosphere, improving throughput, and boosting customer satisfaction through increased staffing and digital engagement [2]

Core Viewpoint - Starbucks reported better-than-expected first-quarter fiscal 2025 results, with earnings and net revenues exceeding estimates, but faced a decline in year-over-year earnings and flat revenues [2][5]. Financial Performance - Earnings per share (EPS) for the quarter was 69 cents, surpassing the Zacks Consensus Estimate by 4.6%, but down 23% from 90 cents in the prior-year quarter [5]. - Net revenues reached $9.398 billion, exceeding the consensus mark of $9.3 billion, and were nearly flat compared to $9.425 billion in the prior-year quarter [5]. - Global comparable store sales declined 4% year over year, driven by a 6% decrease in comparable transactions, partially offset by a 3% increase in average tickets [6]. Operational Insights - The company opened 377 net new stores globally, bringing the total store count to 40,576 [6]. - Operating margin contracted 390 basis points to 11.9% due to increased operating expenses and investments in the "Back to Starbucks" plan [7][8]. Segment Performance - North America segment net revenues were $7.072 billion, down 1% year over year, with comparable store sales declining 4% [9]. - International segment net revenues increased 1% to $1.871 billion, with comparable store sales also down 4% [10]. - Channel Development segment net revenues fell 3% to $436.3 million, attributed to declines in the Global Coffee Alliance and ready-to-drink revenues [12]. Strategic Initiatives - Starbucks aims to enhance sales growth through the "Back to Starbucks" plan, supply-chain efficiencies, menu simplification, and effective marketing campaigns [4]. - The company has suspended its guidance for fiscal 2025 but expects EPS to improve in the latter half of the fiscal year [17][18]. Financial Position - As of the end of the fiscal first quarter, cash and cash equivalents stood at $3.671 billion, up from $3.286 billion at the end of fiscal 2024 [14]. - Long-term debt was $14.312 billion, slightly down from $14.319 billion as of September 2024 [14]. Market Outlook - Estimates for Starbucks have trended downward, with a consensus estimate shift of -8.67% [20][21]. - The stock currently holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [23].