starbucks announced mixed quarterly results on Thursday, with International Cafe’s performance falling short of expectations.
But the upturn in the U.S. continues to take hold, as the coffee giant’s domestic market beat expectations in the final quarter of its 2026 fiscal year.
“We enter fiscal year 2027 with momentum and clear priorities and higher ambitions for what Starbucks can become,” CEO Brian Nicol said in a video shared on the company’s website.
He said on the company’s earnings call that Starbucks is ahead of schedule to meet its 2028 goals set at an investor day in January.
Starbucks expects adjusted earnings per share in the range of $3.15 to $3.25 for fiscal 2027, beating Wall Street’s expectations for earnings of $3.14 per share. However, the expected 1% revenue decline is smaller than expected. Analysts had expected net sales to rise 1.4%.
Starbucks expects North American same-store sales to increase 4% this fiscal year.
The company’s earnings and revenue outlook includes the impact of an additional week and the transition of its China operations to a joint venture business model. Starbucks also expects a slight decline in coffee prices and a slowdown in net new cafe openings in North America, both of which will weigh on full-year earnings, CFO Kathy Smith said.
Starbucks stock fell nearly 2% in after-hours trading.
Here’s how the company reported for the quarter ending September 27 compared to Wall Street’s expectations, based on a survey of analysts by LSEG.
Earnings per share: 80 cents adjusted, 72 cents expected; Revenue: $9.14 billion, $9.23 billion expected.
Starbucks reported fourth-quarter net income attributable to the company of $677.2 million, or 59 cents per share, compared to $133.1 million, or 12 cents per share, in the year-ago period.
Excluding restructuring and impairment charges, the company reported earnings of 80 cents per share.
Net revenue decreased 4% to $9.14 billion, reflecting a joint venture agreement in China.
The company’s global same-store sales rose 7.2%, driven by average ticket growth, beating Wall Street expectations of 6%, according to Street Accounts. Transaction value increased 1.8% in the quarter.
Starbucks reported same-store sales at its U.S. cafes rose 7.7%, beating Street accounts’ expectations for a 6.5% increase.
Under Nicol’s “Back to Starbucks” strategy, the company has focused on improving service, making cafes more welcoming, and strengthening marketing. This change helped win back customers.
“Starbucks’ brand affinity is at near-record levels as Starbucks’ menu innovation, marketing and products continue to drive culture and create moments that bring people to our coffeehouses,” Nicol told analysts.
The company said the North American rollout of its fall menu, which includes the iconic Pumpkin Spice Latte, was the strongest fall launch date in the company’s history. And matcha is now Starbucks’ billion-dollar drink.
Outside of North America, the company’s international sales increased 0.9% as lower traffic offset higher average ticket prices. The growth rate was lower than the 3.2% increase expected by analysts, according to Street Accounts.
After its China operations became joint ventures, Starbucks moved most of its international operations to a licensing model, allowing local operators to handle them. Reuters reported in September that the company is also considering selling a majority stake in its Japan operations.
Starbucks opened 303 net new cafes during the quarter. The company announced in September that it would close about 250 locations, or about 1% of its North American footprint, as part of its turnaround.
By the end of the fiscal year, the company had also completed renovations of more than 1,700 cafes in the U.S. and Canada, with the aim of making its stores more welcoming for customers. The company said stores that undergo renovations, with adjustments such as increased seating and softer lighting, see an increase in subsequent transactions.
