- Surprise Sales Growth: In Q4 (fiscal year ended Sept 28), Starbucks reported global same-store sales up 1%, its first increase in seven quarters. International markets drove the gain (Intl. comps +3%), offsetting flat U.S. comps. Net revenues rose 5% to $9.6 billion (vs. $9.3B expected).
- Profit Impacted by Restructuring: Aggressive cost cuts weighed on profits. Starbucks took a $1 billion restructuring charge, closing 627 stores (90% in the U.S.) and laying off ~900 support staff. As a result, GAAP EPS plunged 85% to $0.12. On an adjusted basis, it earned $0.52 per share (vs. $0.56 expected).
- CEO: Turnaround Progress: CEO Brian Niccol – one year into the job – said the results show “progress in its multi-year turnaround”abcnews.go.com. He’s revamped store operations (new staffing standards and order-sequencing software to cut wait times)abcnews.go.com. CFO Cathy Smith warned that “turnarounds are difficult to forecast … recoveries are not linear,” cautioning that improvement will be gradualreuters.com.
- “Back to Starbucks” Strategy: Under Niccol’s $1 billion plan, Starbucks is “trimming fat” and reinvesting in customersts2.techts2.tech. It is closing underperforming stores (about 1% of its US/CAN estate) and cutting ~900 corporate jobsabcnews.go.comts2.tech. At the same time, Starbucks is adding staff during peak periods – hiring roughly 1,500–2,000 more baristas by next spring and ~3,000 by year-endts2.tech – to speed service and improve the in-store experience.
- Menu & Tech Innovations: Niccol has also pushed new products and tech. He teased premium protein-packed drinks and upscale pastries for next yearts2.tech, and Starbucks is piloting a Microsoft-powered “Green Dot” AI assistant on iPads to help baristas with orders and equipment questionsts2.tech. Over 1,000 stores will get warmer new interiors and a simpler menu (30% fewer items)ts2.tech. (Starbucks even inked a deal as the 2028 LA Olympics’ official coffee sponsorts2.tech.)
- Stock Jump & Forecast: Investors cheered the sales rebound. Starbucks shares rose ~2% in after-hours trading on the newsabcnews.go.com. The stock trades in the mid-$80s (about 10% below last year)ts2.tech, and Wall Street is cautiously optimistic. Roughly two-thirds of analysts rate SBUX a “Buy,” with consensus targets around $100–104ts2.tech – implying 20–25% upside from current levels. TipRanks’ own model sees “Outperform” with a ~$105 targetts2.tech, as experts reckon Starbucks earnings should rebound (~23% growth in FY2026) once Niccol’s changes take hold.
Starbucks’ surprisingly strong Q4 sales and its renewed focus on customers suggest its “Back to Starbucks” strategy is gaining tractionabcnews.go.comts2.tech. Still, higher costs (coffee-bean prices, tariffs on imports) cut into marginsreuters.com. The company suspended guidance, with CFO Smith saying new forecasts will come at an investor event in Januaryreuters.com. In the meantime, analysts note that if Starbucks can sustain this momentum – by winning back customers and controlling costs – the stock may have further room to run. As one UBS analyst put it, investors are watching for an inflection in sales trends next yearts2.tech.
Sources: Starbucks Q4 financial report; Associated Press/ABC News (via TheHill); Reuters analysis; TechStock²/ts2.tech strategy overview; stock analyst consensus (TipRanks); Nasdaq/Starbucks investor site.
