New York, Jan 29, 2026, 11:49 EST — Regular session
- Starbucks shares slipped roughly 0.7%, with investors weighing the fresh 2028 goals revealed during CEO Niccol’s inaugural Investor Day
- Company outlined a long-term non-GAAP EPS target between $3.35 and $4.00, aiming for an operating margin of 13.5% to 15% by fiscal 2028
- Wall Street is focused on whether strong sales can push margins back up despite rising labor and coffee expenses
Starbucks shares slipped on Thursday following its Investor Day, where the coffee giant outlined long-term growth and profit goals, fueling ongoing margin concerns. The stock fell roughly 0.7% to $94.49, hitting a low of $93.06 earlier in the session.
The timing is key. This was Brian Niccol’s inaugural Investor Day since taking the helm in September 2024, coming just a day after Starbucks posted its first U.S. sales gain in two years.
After Niccol put financial guidance on hold early in his time at the helm, investors have been eager for a clearer plan. The focus now sharpens: how quickly can Starbucks ramp up service, resolve supply chain issues, and boost profits without relying too much on price hikes?
At Investor Day, Starbucks projected fiscal 2028 consolidated net revenue growth of 5% or more, alongside non-GAAP EPS between $3.35 and $4.00. The company also targeted a non-GAAP operating margin ranging from 13.5% to 15%. CFO Cathy Smith described these targets as a blueprint for “sustainable, profitable growth.” Starbucks Investor Relations
The company outlined plans to relaunch Starbucks Rewards on March 10, introducing three tiers: Green, Gold, and Reserve. It expects to boost member engagement, noting that Rewards accounted for nearly 60% of U.S. company-operated revenue in fiscal 2025.
Starbucks unveiled its fiscal first-quarter results a day earlier, showing positive momentum at the top line. Global comparable-store sales, which measure revenue at locations open at least 13 months, increased 4%. Consolidated net revenues climbed 6%, reaching $9.9 billion. The company reported GAAP earnings per share of $0.26 and non-GAAP EPS of $0.56. Looking ahead, Starbucks projected fiscal 2026 non-GAAP EPS between $2.15 and $2.40.
On Wednesday, the company disclosed that earnings release in an 8-K filing.
Margins continue to be a challenge. Starbucks’ GAAP operating margin dropped 290 basis points to 9.0% this quarter; remember, a basis point equals one hundredth of a percentage point. Nick Setyan, analyst at Mizuho Securities, noted that the sales boost offers some relief “in the near term,” but stressed that operating margins must begin to improve within the next year. Reuters
At its Investor Day in New York, Starbucks executives laid out a 2028 plan focused on regaining pre-pandemic profit levels. CEO Smith highlighted cost cuts, including trimming expenses on store remodels and modest menu price hikes. Reuters added that Starbucks aims to have 90% of its company-owned stores restocked daily by the end of 2026, targeting persistent out-of-stock issues.
Niccol explained that the Rewards overhaul focuses more on experiences rather than broad discounts, with the premium “reserve” tier offering chances for paid trips. Kate Hogenson, principal consultant at the Mallett Group, noted that top loyalty programs build “emotional memories,” but tiered rewards are less common in restaurants compared to travel. Reuters
Things could easily take a wrong turn. Should traffic drop once the holiday surge fades, or if coffee prices and labor costs remain high, margin recovery might fall short of the company’s goals. Execution risks remain significant, and the China partnership still requires regulatory approval.
Investors have their sights set on March 10, the date when the new Rewards tiers launch. Traders are also eyeing initial data on service speed and in-stock levels, along with whether Starbucks can begin boosting margins as 2026 gets underway.
