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STARBUCKS CORP (SBUX)·Q4 2025 Earnings Summary

Executive Summary

  • Mixed print with a top-line beat but EPS miss as restructuring and inflation compressed margins; Q4 revenue rose 5.5% to $9.57B vs. S&P Global consensus $9.35B*, while non-GAAP EPS was $0.52 vs. $0.556 consensus*; GAAP EPS was $0.12 due to $755M restructuring .
  • Global comps turned positive (+1%) for the first time in 7 quarters; U.S. comps were flat with September positive, and International comps +3% led by China +2% (transactions +9%) .
  • Margins compressed: GAAP operating margin 2.9% (–1,150 bps YoY) on restructuring, deleverage, labor investments, and inflation; non-GAAP operating margin 9.4% (–500 bps YoY) .
  • Guidance framework deferred to late-January investor day; near-term outlook notes FY26 G&A below FY23, coffee remains a headwind through at least 1H FY26; quarterly dividend raised to $0.62 (15th straight annual increase) .
  • Potential stock reaction catalysts: return to positive comps, International strength and Channel Development growth, but EPS miss and restructuring/margin compression may temper enthusiasm; holiday setup and U.S. comp inflection cited as near-term drivers .

What Went Well and What Went Wrong

  • What Went Well

    • Return to growth: Global comps +1% with U.S. flat and September turning positive; International comps +3% (China +2% comps, +9% transactions) .
    • International and Channel Development momentum: International revenue +9% to $2.07B; Channel Development revenue +17% to $543M .
    • Execution on “Back to Starbucks”: CEO noted the turnaround is taking hold; Green Apron Service rollout drove faster service and improved customer scores; “the plan is working” .

  • What Went Wrong

    • EPS/margin pressure: Non-GAAP EPS $0.52 fell 35% YoY; GAAP operating margin fell to 2.9% on $755M restructuring, inflation, labor investments, and deleverage .
    • North America profitability: NA operating margin fell to 4.5% (–1,420 bps YoY) amid restructuring and higher store operating expenses; operating income down 75% YoY .
    • Licensed channel softness in U.S.: U.S. licensed store revenue declined; grocery/retail channels weak, though travel/airports and colleges were bright spots .

Financial Results

MetricQ4 2024Q3 2025Q4 2025 ActualQ4 2025 Consensus
Revenue ($B)$9.074 $9.456 $9.569 $9.352*
GAAP EPS ($)$0.80 $0.49 $0.12 $0.556* (Primary EPS)
Non-GAAP EPS ($)$0.80 $0.50 $0.52 $0.556* (Primary EPS)
GAAP Operating Margin (%)14.4% 9.9% 2.9% n/a
Non-GAAP Operating Margin (%)14.4% 10.1% 9.4% n/a
EBITDA ($B)n/an/a$1.506*$1.363*
  • Q4 revenue beat consensus by ~$0.22B; non-GAAP EPS missed by ~$0.04; EBITDA beat. Restructuring of $755M (EPS +$0.66 add-back), litigation settlement (–$0.13), and transaction costs (+$0.01) reconciled non-GAAP EPS to $0.52 .
  • Values marked with * retrieved from S&P Global.

Segment performance

SegmentMetricQ4 2024Q4 2025
North AmericaNet revenues ($MM)6,691.9 6,901.5
Operating income ($MM)1,253.5 308.5
Operating margin (%)18.7% 4.5%
InternationalNet revenues ($MM)1,893.2 2,070.9
Operating income ($MM)282.9 223.2
Operating margin (%)14.9% 10.8%
Channel DevelopmentNet revenues ($MM)465.4 542.6
Operating income ($MM)264.7 265.2
Operating margin (%)56.9% 48.9%

KPIs and operating detail

KPIQ2 2025Q3 2025Q4 2025
Global comps (%)(1%) (2%) +1%
North America comps (%)(1%) (2%) 0%
U.S. comps (%)(2%) (2%) 0% (Sept positive)
International comps (%)+2% 0% +3%
China comps (%)0% +2% +2%
U.S. 90-day Rewards MAUs (MM)n/an/a34.2
Net store change (Qtr)+213 +308 (107) (627 closures under plan)
Ending stores (Global)40,789 41,097 40,990

Non-GAAP adjustments (Q4)

  • Restructuring and impairments: $755.0M; Litigation settlements: $(145.2)M; Transaction costs: $8.2M; EPS effects: +$0.66, (–$0.13), +$0.01; tax effect: (–$0.14) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance/OutlookChange
Dividend per share (quarterly)Payable Nov 28, 2025$0.61 (Q3 declaration) $0.62 (15th consecutive annual increase) Raised
Consolidated G&AFY26n/aFY26 G&A to run below FY23 levels New outlook (lower)
Coffee commodity costsFY26n/aHeadwind through at least 1H FY26 New headwind
U.S. company-operated compsFY26n/aShould build through the year; Q1 start aided by Sept/Oct positive comps and holiday lineup Positive trajectory
Store portfolio (NA)FY26 baselinen/a627 closures completed in Q4; baseline NA revenue reduced; margin impact slightly accretive Portfolio optimized
Formal financial guidanceFY26+n/aTo be provided at late-January investor day Timing set

Earnings Call Themes & Trends

TopicQ2 2025 (Q-2)Q3 2025 (Q-1)Q4 2025 (Current)Trend
U.S. transactions/compsNA comps (1)%; actions on labor and restructuring; turnaround building 3rd straight improvement in U.S. transaction comps; comps (2)% U.S. comps flat; September positive; Green Apron driving faster service, higher engagement Improving
Green Apron ServiceInitiated increased labor and support org simplification Built operating foundation; Leadership Experience 2025 Nationwide rollout; 80% cafes ≤4 min service time; sequential gains as teams adapt Scaling
Product/menu innovationEarly pipeline; focus on value and service Innovation to “unleash” in 2026 Protein platform launch; broad customization; positive value perception Accelerating
International/ChinaInternational comps +2%; China comps flat International revenue record; China comps +2% International revenue record; China comps +2%, +9% transactions; evaluating strategic partner with retained stake Stable to improving
Costs/Inflation/TariffsMargin contraction on deleverage/labor; restructuring costs Margin pressure; inflation and promotions Coffee/tariffs headwinds; FY26 1H coffee headwind; G&A set to decline vs FY23 Mixed: input headwinds, G&A tailwind
Licensed businessn/an/aReworking licensee support; growth opportunity; licensee summit Positive initiative

Management Commentary

  • “We finished the fiscal year strong with 5% global revenue growth and global comparable store sales growth of 1% in the fourth quarter, making it our first positive quarter in seven quarters.”
  • “Back to Starbucks is not a slogan. It’s an enduring model for growth…for every access mode.”
  • On Green Apron: “More than 80% of U.S. company-operated coffee houses had cafe service times averaging four minutes or less.”
  • On protein platform: “You can now have Protein in over 90% of the drinks…feedback…has been really positive.”
  • On China: “We expect to retain a meaningful stake in Starbucks China and remain confident in the long-term growth potential.”
  • CFO: “Q4 was a turning point…we announced an increase to our quarterly dividend earlier this month, recognizing our 15th consecutive year of increase.”

Q&A Highlights

  • Breadth of “Back to Starbucks”: Management emphasized a comprehensive approach across cafe, mobile, drive-thru, and delivery; positive transaction-led comps in September cited as validation .
  • Protein platform and pricing: Early strong reception; viewed as “tremendous value” with customization; supports health/wellness positioning .
  • Green Apron rollout maturity: Only 8–9 weeks in; pilot cohort continues to outperform; expects continued build as rosters stabilize and customers internalize new service standard .
  • Store closures rationale/impact: Driven primarily by insufficient topline potential and experience standards; closure program slightly accretive to margins; some sales transfer to nearby stores .
  • FY26 setup: U.S. comps expected to build through the year; investment annualizes; coffee cost headwind in 1H; more formal outlook at investor day .

Estimates Context

Metric (Q4 2025)ConsensusActualSurprise
Revenue ($B)9.352*9.569 +0.217
Primary EPS ($)0.556*0.52 –0.04
EBITDA ($B)1.363*1.506*+0.143
  • Coverage depth: EPS (30 est.), Revenue (26 est.). Results suggest estimate revisions may modestly increase revenue and EBITDA but pressure EPS until restructuring/investments annualize.
  • Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Topline inflection: Broad-based comp improvement with International strength and U.S. September turning positive—a necessary precondition for sustainable EPS recovery .
  • Margin rebuild path: FY26 G&A tailwind vs FY23 and portfolio pruning (slightly accretive) will help offset labor/coffee/tariff headwinds; EPS leverage likely back-half weighted if coffee eases .
  • U.S. execution cycle: Green Apron Service and staffing normalization are early but measurable drivers of throughput and satisfaction; watch holiday and Q1 trends for durability .
  • Innovation catalyst: Protein platform, matcha optimization, and bakery upgrades target traffic frequency and afternoon daypart; supports share gains without blunt pricing .
  • China optionality: Retaining a meaningful stake plus potential partner capital and royalties could de-risk execution and fund growth .
  • Capital returns maintained: Dividend increased to $0.62; signals confidence despite near-term EPS compression .
  • Near-term trading setup: Revenue/EBITDA outperformance vs consensus vs. EPS miss and heavy restructuring may create a mixed reaction; trajectory into holiday and confirmation of positive U.S. comps likely to drive sentiment into investor day .

Notes:

  • All non-* figures sourced from company filings and transcripts as cited. Values marked with * retrieved from S&P Global.