Starbucks reported on Jan. 28, 2026 that same-store sales in the U.S. rose 4 percent for the quarter ended Dec. 28, 2025, signaling momentum in its turnaround plan. The company said traffic and average ticket improved while global same-store sales climbed 4 percent and revenue reached $9.9 billion. Profit fell to $293 million, down more than 60 percent from a year earlier as labor and operational investments increased. Shares jumped about 9 percent in premarket trading after the results were released.
Key Takeaways
- U.S. same-store sales (stores open at least one year) increased 4 percent in the quarter ended Dec. 28, 2025, beating analyst expectations.
- Global same-store sales rose 4 percent year-over-year; international same-store sales were up 5 percent and China nearly 7 percent.
- Company revenue was $9.9 billion for the quarter, a 5 percent increase versus the prior year.
- Net income fell to $293 million, a decline of more than 60 percent, driven by higher labor and operational costs tied to the turnaround effort.
- Starbucks opened 128 net new stores in the quarter and had closed more than 600 underperforming locations late in the prior quarter.
- Starbucks agreed to sell up to 60 percent of its China retail operations to Boyu Capital in a deal valued at $4 billion; the joint venture would operate roughly 8,000 stores in China.
- Management cited improved traffic and ticket size, and attributed some lift to a limited holiday product that went viral and sold out quickly.
Background
Starbucks entered a multi-quarter turnaround initiative aimed at reversing years of slowing comps, service frictions and cost pressures. The program has emphasized store-level staffing, streamlined operations and menu and product promotions intended to drive traffic and higher ticket values. Late in the prior quarter the company closed more than 600 underperforming locations, a structural move intended to reduce drag on comparable-store metrics and reallocate customers to healthier stores.
International markets have been a focal point for growth strategy; China in particular has been both an opportunity and a source of restructuring. In early November 2025 Starbucks announced an agreement with Boyu Capital to sell up to 60 percent of its China retail operations in a transaction valued at $4 billion, creating a joint venture to run nearly 8,000 stores. The deal is designed to combine local operating expertise with Starbucks’ brand and IP licensing.
Main Event
On Jan. 28, 2026 Starbucks released quarterly results showing top-line improvement driven by foot traffic gains and higher average spending per visit. U.S. same-store sales rose 4 percent for locations open at least a year in the quarter ending Dec. 28, outperforming many analysts’ forecasts. Management highlighted both product momentum — including a limited holiday cup that became a viral item — and the operational effects of recent store closures as contributors to the comps beat.
Revenue for the quarter reached $9.9 billion, up 5 percent year-over-year, while global same-store sales increased 4 percent and international comps improved 5 percent. China again stood out with comps near 7 percent, a notable recovery that coincided with the announced Boyu Capital joint-venture plan. The company opened 128 new stores during the quarter even as it restructured its store footprint.
Despite revenue gains, net income declined sharply to $293 million, more than a 60 percent drop from the prior year, reflecting meaningful expense increases. Starbucks said the expense step-up was largely due to hiring additional store employees and investments intended to speed order delivery and improve the customer experience as part of the turnaround. Shares rose roughly 9 percent in premarket trading once the results and commentary were public.
Analysis & Implications
The disconnect between rising revenue and sharply lower profit underscores that Starbucks’ current priority is restoring service and sales momentum rather than near-term margin expansion. The company chose to add labor and operational capacity to reduce order times and improve in-store service, accepting higher costs in hopes that traffic and ticket rebuilding will deliver stronger margins later. If the traffic gains prove durable, margins could recover as the incremental revenue leverages fixed costs and the company optimizes labor scheduling.
Store closures of more than 600 underperforming locations likely had a twofold effect: removing low-producing units that depressed comp metrics and shifting some customer purchase volume to nearby, better-performing stores. That sales transfer tends to inflate same-store sales in the short run, so investors will watch future quarters for sustained growth absent additional closures. The opening of 128 stores in the same period shows the company is simultaneously pruning and selectively expanding.
The China joint-venture with Boyu Capital changes the risk and return profile of Starbucks’ largest international market. Selling up to 60 percent of retail operations for $4 billion reduces direct capital exposure and brings local partners’ operational expertise, but it also means Starbucks will depend more on licensing and partnership economics for future China upside. How quickly the JV integrates and whether it sustains the near-7 percent comp improvement will materially shape Starbucks’ international revenue trajectory.
Comparison & Data
| Metric | Quarter (ended Dec. 28, 2025) | Year-over-Year Change |
|---|---|---|
| U.S. same-store sales (stores >=1 yr) | +4% | Beat expectations |
| Global same-store sales | +4% | +4% |
| International same-store sales | +5% | +5% |
| China same-store sales | ~+7% | ~+7% |
| Revenue | $9.9 billion | +5% |
| Net income | $293 million | Down >60% |
| Stores opened (quarter) | 128 | — |
| Stores closed (previous quarter) | >600 | — |
The table lays out the core operating and financial moves driving the quarter: solid comps and revenue growth alongside materially higher expenses that compressed profit. Analysts will parse whether the revenue gains are cyclical — for example, driven by seasonal or product-specific phenomena — or truly structural as execution improvements take hold.
Reactions & Quotes
Management framed the quarter as evidence that its turnaround priorities are taking hold and that investments are beginning to produce measurable sales benefits.
“This turnaround is working and we believe we’re ahead of schedule,”
Brian Niccol, Starbucks Chief Executive
The company also emphasized operational adjustments aimed at faster service and a better in-store experience, linking those initiatives to the higher labor expense reported for the period.
“We have increased store staffing and adjusted operations to improve speed of service and customer satisfaction,”
Starbucks (company statement)
Market participants reacted quickly to the top-line beat and management’s confidence, sending shares higher in premarket trading; analysts noted the combination of store closures and promotional momentum as proximate drivers.
“Investors rewarded the better-than-expected comps and the clearer path to traffic recovery,”
Market analysts (summary of commentary)
Unconfirmed
- The exact share of the sales lift attributable to the limited holiday cup versus operational changes is not independently verified and remains unclear.
- The degree to which store closures permanently shifted customers to healthier nearby stores versus temporarily concentrating purchases is not yet quantified.
- Final governance, operational control and performance targets for the Boyu Capital joint venture in China beyond the headline terms are subject to definitive agreements and regulatory approvals.
Bottom Line
Starbucks’ January 28, 2026 results show a company in the early phases of a deliberate recovery: comp improvement and revenue growth accompanied by elevated investment-driven costs. Management’s characterization that the turnaround is “ahead of schedule” is supported by a better-than-expected comps print and improving international trends, especially in China, but profitability remains constrained while the company pays to accelerate service improvements.
Investors should watch the next several quarters for evidence that higher traffic and ticket sustainably outpace the added costs, and for clarity on the China joint-venture’s execution. If comp momentum broadens and the China JV delivers on scale, Starbucks could see a more durable margin recovery; if gains prove temporary or localized, management will face pressure to translate top-line progress into profit recovery.
Sources
- The New York Times — news report summarizing results and market reaction (journalism)
- Starbucks Investor Relations — official earnings release and company statements (company/official)