Core Insights - Starbucks Corporation operates as a global roaster, marketer, and retailer of coffee, with a market cap of $98.6 billion, and segments including North America, International, and Channel Development [1][2] Financial Performance - Starbucks stock reached a three-year high of $117.46 on March 3 but is currently trading 26.2% below that peak [3] - Year-to-date, Starbucks stock has dropped nearly 5%, and over the past 52 weeks, it has declined 13.9%, while the Dow Jones has gained 11.5% in 2025 and 5.7% over the past year [4] - The company has been trading below its 200-day moving average since early April and below its 50-day moving average since late July, indicating a bearish trend [4] Sales and Strategy - Under the new CEO Brian Niccol's "Back to Starbucks" strategy, comparable sales have consistently declined for several quarters, with North America comps remaining flat year-over-year in Q4 2025, while international comps improved by 3% [5] - Overall topline revenue increased 5.5% year-over-year to $9.6 billion, surpassing expectations, but margins were squeezed due to lower average ticket sizes in international markets [6] - Adjusted EPS for the quarter fell 35% year-over-year to $0.52, missing consensus estimates by 5.5%, leading to a 1.2% drop in stock prices following the Q4 results release [6]

Deagreez / iStock via Getty Images Starbucks Corp. (NASDAQ: SBUX) share prices suggest the company’s best year is well behind it, in 2021. The coffee purveyor has had a revolving door for chief executives since then. Kevin Johnson, Howard Schultz, Laxman Narasimhan, and Brian Niccol have all held the job. Schultz is its proverbial bad penny. Quick Read Starbucks Corp. (NASDAQ: SBUX) stock suggests the coffee purveyor’s best years are well behind it. The latest in a line of CEOs has failed to turn aro ...

Core Insights - The company has emphasized service improvements through the Green Apron project, which involves hiring more staff and retraining existing employees to enhance customer experience [1][2][3] Staffing and Training - The partners have positively embraced the back to Starbucks strategy and the Green Apron service standard, leading to a renewed focus on customer connection [2] - The company has increased staffing levels and hours, enabling employees to perform their jobs with excellence [3] - Great leadership in stores facilitates quick training for new hires, contributing to overall service quality [3] Customer Experience Enhancements - The company aims to provide a great greeting and handoff experience for customers, focusing on creating a welcoming atmosphere [4] - Efforts are being made to improve seating and utilize technology to manage orders efficiently, resulting in positive feedback from partners and customers [5] Store Design and Operations - The company is working on making store interiors more accommodating and efficient while also exploring lower-cost models for building and operating locations [6] - Strategies for great design and cost-conscious operations can coexist, ensuring that both partners and customers have a successful experience [7] - Coffeehouse uplifts can be completed quickly without closing stores, leading to meaningful transformations that enhance customer satisfaction [8][9]

Core Insights - Starbucks is set to complete 1,000 café renovations by the end of 2026, focusing on improved lighting, seating, and a welcoming aesthetic [1] - The company is piloting a new store prototype that features lower build costs and optimized space utilization, replacing the discontinued pickup-only cafes [2] - The "Back to Starbucks" strategy aims to enhance efficiency and value perception, with global same-store sales growth increasing for the first time in seven quarters, although U.S. comps remain flat [3] Renovation and Store Design - The café renovations are part of a broader strategy to revitalize the brand and improve customer experience [1][3] - The new store designs have already been implemented in select markets, including New York and California [1] Efficiency Improvements - Starbucks reported progress in staffing and store hours, with nearly all U.S. locations now opening consistently at or before 5 a.m. [5] - The implementation of a new order sequencing algorithm has resulted in over 80% of cafes achieving service times of four minutes or less [5] Value Perception - Despite criticisms regarding pricing, Starbucks has seen an increase in value scores by emphasizing non-pricing aspects such as café experience and shorter wait times [6] - Menu innovations, including a new protein beverage platform, are part of the strategy to enhance customer value perception [6]

Core Insights - The "Back to Starbucks" strategy is focused on enhancing customer service experience, which differentiates the brand from competitors [3] - Brand affinity has reached its highest level since 2023, with the share of customers ranking Starbucks as their first choice at a 5-year high [3] - Significant improvements have been noted in service time and customer perceptions of connection and care [3] Financial Performance - Non-Starbucks Rewards member transactions increased year over year for the second consecutive quarter [4] - The share of company-owned stores with positive comparable transactions more than tripled year over year [4] - Global comparable store sales increased by 1% year over year in Q4 2025, with North America and U.S. comparable store sales remaining flat [5] Operational Improvements - More than 80% of company-owned cafes achieved an average service time of 4 minutes or less due to a new sequencing algorithm [7] - The Green Apron Service model, which adds staff and hours to cafes, has led to strong worker engagement and record low hourly employee turnover [7] Challenges - The company faced challenges including a series of store closures, particularly 59 unionized stores, and ongoing union activities [6]

Core Insights - Starbucks has reported a return to global comparable store sales growth, marking its first increase in seven quarters, with a 1% rise in comparable store sales across its global estate [1] - The US market experienced flat same-store sales overall but turned positive in September 2025, while international comparable store sales rose by 3% [2] - Consolidated net revenues for the quarter reached $9.6 billion, reflecting a 5% increase from the previous year [2] Financial Performance - North America net revenues increased by 3% year-on-year to $6.9 billion, although this was partially offset by a decline in the licensed store business [3] - The international segment's net revenues grew by 9% year-on-year to $2.1 billion [3] - Fiscal fourth-quarter net income attributable to Starbucks was $133.1 million, or $0.12 per share, down from $909.3 million, or $0.80 per share, a year earlier [5] Operational Changes - The company recorded a $1 billion charge for restructuring, which included the closure of 627 stores, primarily in North America, and the layoff of 900 employees [4] - The operating margin fell by 1,150 basis points year-on-year to 2.9%, mainly due to restructuring costs and inflation [5] - Starbucks ended the quarter with 40,990 stores globally, with the US and China accounting for 61% of its store footprint [6] Strategic Focus - The "Back to Starbucks" strategy, initiated by CEO Brian Niccol, aims to reduce operational complexity and enhance the in-store customer experience [4] - The company acknowledges that the turnaround is a multi-year process, focusing on driving topline growth while managing controllable costs [7]

Core Insights - Starbucks Corporation has experienced significant underperformance compared to the broader market, with its stock dropping 7.8% in 2025 and 13.6% over the past 52 weeks, while the S&P 500 Index gained 17.2% year-to-date and 18.1% over the past year [2] - The company's new CEO Brian Niccol's "Back to Starbucks" strategy has not yielded the expected results, as comparable sales have consistently declined, with North America comps remaining flat year-over-year in Q4 2025, although international comps improved by 3% [4] - Despite a 5.5% year-over-year increase in overall topline to $9.6 billion, adjusted EPS plummeted 35% year-over-year to $0.52, missing consensus estimates by 5.5% [5] Financial Performance - Starbucks' overall topline increased to $9.6 billion, beating market expectations, but margins were squeezed due to lower average ticket sizes in international markets and subdued local market performance [5] - Analysts expect Starbucks to deliver solid double-digit growth in earnings for fiscal 2026, but the company has a mixed earnings surprise history, surpassing bottom-line estimates only once in the past four quarters [6] Analyst Ratings - The consensus rating for Starbucks is "Moderate Buy," with 35 analysts covering the stock, including 16 "Strong Buys," 2 "Moderate Buys," 13 "Holds," 2 "Moderate Sells," and 2 "Strong Sells" [7]

Core Insights - Starbucks has reported its first global comparable store sales growth in seven quarters, attributed to the turnaround strategy initiated last year [1][3] Financial Performance - Global comparable store sales increased by 1% for the quarter ending September 28, with North America segment sales flat and international segment sales up by 3% [2] - In the same quarter of the previous year, North America segment sales were down by 6% and international segment sales were down by 9% [2] Strategic Initiatives - The "Back to Starbucks" strategy aims to return the company to its roots while addressing future challenges, focusing on enhancing customer experience and operational efficiency [3][4] - Key components of the strategy include providing baristas with necessary tools, improving supply chain logistics, and enhancing the mobile ordering platform [4] - Starbucks plans to close underperforming coffeehouses, reducing its store count by 1% to approximately 18,300 locations in the U.S. and Canada, while also planning to renovate 1,000 stores [4]

Core Insights - Starbucks reported its first quarter of positive global same-store sales since 2023, with a systemwide increase of 1% after six consecutive quarters of declines [1] - U.S. same-store sales remained flat for the fourth quarter of 2025, which ended on September 28 [1] Sales Performance - The systemwide sales growth was primarily driven by global traffic gains, while in North America, same-store sales were mainly supported by ticket growth, offset by traffic declines [2] - International same-store sales increased by 3%, driven by a 6% traffic growth, despite a 3% decline in average ticket [3] Market Challenges and Strategies - CEO Brian Niccol stated that the "Back to Starbucks" strategy is proving effective one year after its implementation [2] - CFO Cathy Smith highlighted that Q4 marked a turning point for the company, with expectations for U.S. company-operated comps to build throughout the year, although recoveries may not be linear [3] Store Closures and Financials - Starbucks closed 627 stores in Q4, representing 1% of all North America stores, with over 90% of closures occurring in North America [4] - The net store count declined by 107 cafes after considering store openings [4] - The company reported a 5.5% increase in net revenues to $9.6 billion for Q4 2025, but net income fell over 85% from $909 million in Q4 2024 to $133.1 million in Q4 2025 [5]

Financial Data and Key Metrics Changes - The company reported consolidated revenue of $9.6 billion for Q4, reflecting a 5% increase year-over-year, driven by 2% net new company-operated store growth and a 1% increase in global comparable store sales [23][24] - Earnings per share (EPS) for Q4 was $0.52, down 34% from the prior year, primarily due to inflation and investments in the Back to Starbucks strategy [29][33] - The consolidated operating margin for Q4 was 9.4%, contracting 500 basis points from the prior year, mainly due to inflation and increased labor costs [28][29] Business Line Data and Key Metrics Changes - U.S. comparable store sales were flat year-over-year, with ticket prices up 1%, reflecting fewer discount-driven offers [23][24] - The international segment reported a 9% year-over-year net revenue growth in Q4, reaching over $2 billion, with strong performance in China, Japan, the U.K., and Mexico [25][26] - The channel development segment saw a 16% year-over-year revenue growth due to higher revenue from the Global Coffee Alliance [27] Market Data and Key Metrics Changes - The international business ended the year with record revenues of $7.8 billion, opening 316 net new coffee houses in Q4, totaling over 900 for fiscal 2025 [15] - Starbucks China achieved 2% comparable store sales growth in Q4, driven by a 9% improvement in comparable transactions [25][26] - The U.S. licensed store portfolio revenue declined in Q4, primarily due to trends in grocery and retail channels, while travel segments showed positive growth [24][25] Company Strategy and Development Direction - The company is focused on its "Back to Starbucks" strategy, emphasizing customer connection and craft, with significant investments in staffing and service standards [5][8] - The rollout of the Green Apron Service aims to enhance customer experience and operational efficiency, with positive early results observed [9][10] - The company is piloting a new coffee house prototype to optimize space utilization and reduce build costs while maintaining a full coffee house experience [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the turnaround strategy, noting the first positive quarter in global comparable store sales in seven quarters [6][22] - The holiday season is anticipated to be a significant opportunity for growth, with a focus on delivering a warm and welcoming customer experience [16][17] - The company acknowledges ongoing challenges with inflation and commodity prices but remains optimistic about long-term growth potential [28][32] Other Important Information - The company completed 107 net store closures globally as part of its restructuring efforts, which are expected to be slightly accretive to profitability [30][31] - The company plans to continue investing in Green Apron Service and menu innovation to drive customer engagement and transaction growth [19][20] Q&A Session Summary Question: Concerns about the "Back to Starbucks" strategy - Management clarified that the strategy is comprehensive and aims to enhance customer connection and craft across all service channels, not just in-cafe experiences [36][39] Question: Feedback on the Protein Platform - The Protein Platform has received positive feedback, with customers appreciating the customization options and perceived value [42][46] Question: Progress of the Green Apron Service model - Management noted that the initial rollout has shown positive results, with ongoing improvements expected as staff and customers adapt to the new service standard [49][51] Question: Impact of store closures on profitability - Management indicated that closures were based on the inability to meet customer experience standards and profitability, with expectations of sales transfer to nearby locations [70][72] Question: Future pricing strategies - The company plans to be strategic with pricing, monitoring value perception while addressing inflationary pressures [80][81]