Recent news highlights Starbucks' first quarter US sales growth in two years, ongoing strategic initiatives, and operational changes including CEO private jet use policy.

• Starbucks reported its first quarter of US sales growth in two years, indicating progress in its turnaround efforts [N1].
• The company mandated CEO private jet use following a security review, reflecting governance and operational oversight [N2].
• Upcoming earnings reports are anticipated to provide further insights into Starbucks' financial and operational performance [N3].
• Market commentary noted that CEO Brian Niccol has 'cracked the code' on Starbucks' strategy, highlighting positive investor sentiment [N4].

Starbucks' ongoing 'Back to Starbucks' initiatives aim to enhance customer experience and operational efficiency, potentially driving comparable store sales growth and margin improvement over time. The company's strategic joint venture in China with Boyu Capital represents a significant opportunity to accelerate growth in a key international market. Continued innovation in menu offerings, digital engagement, and supply chain improvements may strengthen customer loyalty and operational leverage. The company's strong liquidity position and capital allocation discipline support investments in growth and shareholder returns.

Starbucks faces margin pressure from restructuring costs, labor investments, and inflationary pressures including elevated coffee prices and tariffs, which have led to operating margin contraction and EPS decline. Store closures, while aimed at portfolio optimization, reduce baseline revenues and may impact near-term growth. The transition of China retail operations to a joint venture introduces execution risks and changes in revenue recognition. Macroeconomic challenges and commodity price volatility remain risks to financial performance. The company's ability to sustain and grow comparable store sales amid competitive and economic pressures is uncertain.

Starbucks' moat is built on its strong global brand recognition, extensive retail footprint with over 41,000 stores worldwide, and a loyal customer base supported by its Starbucks Rewards program. Its integrated supply chain and strategic partnerships, such as the Global Coffee Alliance with Nestlé, enhance product distribution and consumer reach. The company's focus on customer experience innovations, including the Green Apron Service model, and disciplined capital allocation contribute to operational efficiency and competitive positioning. Additionally, Starbucks' scale and geographic diversification across North America, International markets, and Channel Development segments provide resilience and growth opportunities.

• Macroeconomic and Commodity Price Risks: Starbucks is exposed to risks from inflation, tariffs, and volatility in green coffee prices, which impact cost of goods sold and operating margins.
• Execution Risks in Strategic Initiatives: The success of the 'Back to Starbucks' strategy, including store closures and service model implementation, depends on effective execution and customer acceptance.
• China Joint Venture Risks: The joint venture with Boyu Capital for China retail operations involves risks related to transition, regulatory approvals, and future financial performance under equity method accounting.
• Operating Margin Pressure: Labor investments and restructuring costs have led to significant operating margin contraction, which may continue to affect profitability.

• Starbucks is a global roaster, marketer, and retailer of specialty coffee with presence in 90 markets worldwide as of December 28, 2025.
• As of December 28, 2025, Starbucks operated more than 41,000 company-operated and licensed stores, a 1% increase from the prior year.
• The company operates through three reportable segments: North America (U.S. and Canada), International (including China, Japan, Asia Pacific, Europe, Middle East, Africa, Latin America, and the Caribbean), and Channel Development.
• Starbucks' long-term growth model is driven by new store openings, comparable store sales, and operating margin management, supported by disciplined capital allocation.
• Comparable store sales include company-operated stores open 13 months or longer and exclude effects of foreign currency exchange rates.
• Fiscal 2025 consolidated net revenues increased 3% to $37.2 billion compared to $36.2 billion in fiscal 2024.
• Fiscal 2025 consolidated operating income decreased to $2.9 billion from $5.4 billion in fiscal 2024, with operating margin contracting from 15.0% to 7.9%.
• Operating margin contraction was primarily due to restructuring costs related to store closures and support organization simplification, deleverage, investments in the 'Back to Starbucks' strategy, and inflationary pressures.
• Diluted EPS for fiscal 2025 declined to $1.63 from $3.31 in fiscal 2024, mainly due to operating margin contraction and restructuring costs.
• Capital expenditures were $2.3 billion in fiscal 2025, down from $2.8 billion in fiscal 2024.
• Starbucks returned $2.8 billion to shareholders in fiscal 2025 through dividends and share repurchases.
• The company completed most North America store closures in fiscal 2025 and substantially completed International store closures in the first quarter of fiscal 2026, focusing on closing stores without viable profitability or customer experience standards.
• Starbucks implemented the Green Apron Service model across the full U.S. company-operated store portfolio in Q4 fiscal 2025 to enhance customer experience.
• In Q1 fiscal 2026, consolidated net revenues increased 6% to $9.9 billion compared to $9.4 billion in Q1 fiscal 2025, driven by a 4% increase in global comparable store sales (4% U.S., 5% International) and net new store openings.
• Consolidated operating margin in Q1 fiscal 2026 contracted 290 basis points to 9.0%, mainly due to labor investments supporting 'Back to Starbucks' and inflationary pressures including elevated coffee pricing and tariffs.
• North America operating income in Q1 fiscal 2026 decreased 27% to $867 million with operating margin contracting 480 basis points to 11.9%, driven by labor investments and inflationary pressures.
• Starbucks formed a joint venture with Boyu Capital to operate Starbucks retail in China, classifying related assets and liabilities as held for sale in Q1 fiscal 2026.
• The company plans to use proceeds from the China joint venture transaction for debt reduction and to strengthen its balance sheet.
• Liquidity as of December 28, 2025, included cash and equivalents of $3.18 billion, current assets of $12.02 billion, current liabilities of $11.49 billion, with a current ratio of 1.05 and cash ratio of 0.28.
• Net income for the quarter ended December 28, 2025, was $293.3 million.
• Starbucks sells consumer-packaged goods primarily through the Global Coffee Alliance with Nestlé and other partnerships and joint ventures.
• The company focuses on investments in store partners, customer experience, menu innovation, digital experiences, supply chain improvements, and technological efficiencies as part of its 'Back to Starbucks' strategy.