Starbucks (SBUX) earnings Q1 2026

Starbucks on Wednesday reported mixed quarterly results as the company’s turnaround propels traffic growth for the first time in two years but weighs on its bottom line.

“Our Q1 results demonstrate our ‘Back to Starbucks’ strategy is working and we believe we’re ahead of schedule,” CEO Brian Niccol said in a statement. “It’s great to see the sales momentum driven by more customers choosing Starbucks more often, and this is just the beginning.”

The company also shared its first financial outlook since suspending its forecast in October 2024. For fiscal 2026, Starbucks is projecting adjusted earnings per share in a range of $2.15 to $2.40, on the lower end of Wall Street’s estimates of $2.35 per share, according to LSEG. The company is also projecting global and U.S. same-store sales growth of at least 3%.

Shares rose more than 8% in premarket trading.

Here’s what the company reported for the quarter ended Dec. 28 compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: 56 cents adjusted vs. 59 cents expected
• Revenue: $9.92 billion vs. $9.67 billion expected

The coffee giant reported fiscal first-quarter net income attributable to Starbucks of $293.3 million, or 26 cents per share, down from $780.8 million, or 69 cents per share, a year earlier. In addition to costs related to the turnaround, higher coffee prices and tariffs weighed on the company’s margins during the quarter.

Excluding restructuring costs, impairment charges and other items, Starbucks earned 56 cents per share.

Net sales rose 6% to $9.92 billion, driven by the company’s second straight quarter of same-store sales growth.

“We’re seeing exactly what we want to see in our top line at this point in our turnaround,” CFO Cathy Smith said on the company’s earnings conference call.

Global same-store sales increased 4%, topping StreetAccount estimates of 2.3%. Traffic grew 3%, marking the first time that the company’s transactions have grown in two years. Moreover, Starbucks saw transaction growth from both loyalty program members and non-members for the first time since the second quarter of fiscal 2022, according to Niccol.

The company’s same-store sales growth has continued into January, according to Smith.

U.S. same-store sales also rose 4%, fueled by demand for its holiday offerings, like its viral “Bearista” cup and classics menu items like the peppermint mocha. In November, Niccol said the holiday menu launch was the best-ever day for the company’s North American business.

Niccol also credited the company’s “Green Apron Service” program, which focuses on hospitality and efficiency inside its cafes to improve the customer experience.

Outside the U.S., Starbucks’ international same-store sales increased 5%.

China, the company’s second-largest market, saw same-store sales grow 7%. During the quarter, the company announced its plans to form a joint venture with Boyu Capital to run its business in China.

“This partnership will help us expand into more cities, deliver exceptional coffee experiences, create new career opportunities for partners, and strengthen Starbucks’ position as a global brand for long term growth,” Niccol said on the company’s earnings conference call.

The deal is expected to close in the second quarter of fiscal 2026, pending regulatory approval. Starbucks’ fiscal 2026 forecast assumes that the company will keep operating Starbucks China’s retail stores in the second half of the fiscal year.

The company also opened 128 net new locations during the quarter.

In fiscal 2026, Starbucks plans to open 600 to 650 net new company-owned and licensed cafes. The development comes on the heels of the company shuttering roughly 400 U.S. locations last year.

Investors are expecting to hear more details about Niccol’s strategy on Thursday at an investor day held in New York City. Executives will also share the company’s new long-term financial targets.