Starbucks beats on profit as US revival offsets weak international sales

Starbucks reported adjusted earnings of 80 cents per share for its fiscal fourth quarter, beating Wall Street's estimate of 72 cents. Revenue told a different story: $9.14 billion against the $9.23 billion analysts expected, a 4% decline that reflects the shift of the company's China business to a joint venture.

The quarter ended Sept. 27. It closed out fiscal 2026, the coffee giant's final year under its current reporting structure before a new guidance framework takes hold.

Shares fell nearly 2% in extended trading after the report.

What did the quarter deliver?

Net income attributable to Starbucks came in at $677.2 million, or 59 cents per share. A year earlier the figure was $133.1 million, or 12 cents per share — a fivefold improvement that shows how far the turnaround has moved the cost base. Excluding restructuring, impairment costs and other items, the company earned 80 cents per share.

Global same-store sales rose 7.2%, powered by growth in average ticket, according to figures verified against StreetAccount estimates of 6%. Transactions grew 1.8% in the quarter. The growth engine sat squarely in North America.

The comparison that frames the quarter: U.S. cafes posted same-store sales growth of 7.7% against an expected 6.5%, while international comparable sales managed just 0.9% against estimates of 3.2%. Traffic declines abroad offset higher average tickets outside North America.

How is the US turnaround working?

Under CEO Brian Niccol's "Back to Starbucks" strategy, the company has focused on three levers: improving service, making cafes more welcoming and sharpening marketing. The changes have won back customers.

"Starbucks brand affinity is at near record levels as our menu innovation, marketing and merchandise continue to create moments that drive culture and bring people into our coffee houses," Niccol told analysts.

Two product facts anchor that claim. The North American rollout of the fall menu, headlined by the pumpkin spice latte, produced the company's strongest-ever autumn launch day. Matcha, once a niche order, is now a $1 billion drink for Starbucks.

By the end of the fiscal year, the company had completed more than 1,700 cafe uplifts across the U.S. and Canada. The remodels add seating and softer lighting. Starbucks has said locations that receive a makeover see higher transactions afterward.

What did guidance say about fiscal 2027?

Starbucks projects adjusted earnings per share of $3.15 to $3.25 for fiscal 2027, above the $3.14 consensus. The revenue line is weaker: the company expects a 1% decline, while analysts had forecast net sales growth of 1.4%. North American same-store sales growth is projected at 4% for the year.

CFO Cathy Smith spelled out the drags on the revenue outlook: slight deflation in coffee prices and slowing net new North American cafe openings. The guidance also includes an extra week in the fiscal calendar and the effects of the China joint venture transition.

Niccol told analysts the company is ahead of schedule on the fiscal 2028 targets set at its January investor day. "We enter fiscal 2027 with momentum, a clear set of priorities and higher ambitions for what Starbucks can become," he said in a video posted on the company's website.

What is happening to the store network?

Starbucks opened 303 net new cafes during the quarter. In September, it announced plans to close about 1% of its North American footprint, roughly 250 locations, as part of the turnaround.

The portfolio is shrinking in one direction and changing hands in another. After the China deal, Starbucks has shifted most of its international business to a licensed model that lets local operators run the cafes. Reuters reported in September that the company is also exploring selling a majority stake in its Japan business.

The strategic bet is now visible in the numbers: a licensed international model trades revenue for stability, while the U.S. business carries the growth story. Whether fiscal 2027 closes the gap between a 7.7% U.S. sales gain and a guided 1% revenue decline will decide if Niccol's momentum claim holds.