Starbucks’ Revival Strategy Yields First Sales Growth in Two Years
Starbucks announced promising first-quarter results on Wednesday, signifying the first instance of transaction growth in two years. This positive shift is a testament to CEO Brian Niccol’s “Back to Starbucks” revival strategy, which is showing early signs of success.
The Seattle-based coffee behemoth reported a 4% increase in global same-store sales in Q1 of fiscal 2026, significantly outperforming analyst estimates of 2.3%. The traffic surged by 3%, propelled by both loyalty program members and non-members, a first since Q2 of fiscal 2022. U.S. same-store sales witnessed a 4% rise, driven by popular holiday offerings such as the viral “Bearista” cup and classic menu items like peppermint mochas.
Despite the encouraging top-line momentum, the company’s quarterly adjusted earnings per share of $0.56 fell short of Wall Street estimates. This was due to strategic investments in operations and labor impacting profits. For fiscal 2026, Starbucks projects adjusted earnings per share in the range of $2.15 to $2.40 and a minimum of 3% growth in global same-store sales.
In an investor day presentation on Thursday, Niccol unveiled plans for menu innovation, loyalty program adjustments, and an enhanced digital experience. In a landmark move, the company also announced a joint venture with Boyu Capital for its China operations, selling a 60% stake while retaining brand control. By fiscal 2028, Starbucks projects a minimum of 5% revenue growth and earnings per share ranging from $3.35 to $4.
Source: CNBC