November 1, 2026·44 min read
Starbucks Corporation (SBUX), Financial Analysis
Insights derived from analysing SEC filings. Independent analysis, not a publication of the SEC.
Total net revenues Q4 FY2026
$9.14bn
(4.5%) year on year (Q4 FY2025 $9.57bn)
Operating expenses less equity income Q4 FY2026
$8.15bn
(12.3%) year on year (Q4 FY2025 $9.29bn)
Operating margin Q4 FY2026
10.8%
+7.9 pts year on year (Q4 FY2025 2.9%)
Key findings
- Traffic returned to North America. Q4 FY2026 global comparable coffeehouse sales +7.2% (ticket +5.2%, transactions +1.8%), U.S. +7.7%, after (4%) in Q1 FY2025; management said closures and sales transfer added about 200 bps (stated on the call).
- Revenue fell 4.5% to $9.14bn as China left the consolidated accounts. North America $7.33bn, +6.2%; International $1.31bn, (36.9%), after China retail moved to the 40% owned Boyu joint venture in Apr 2026.
- Margins rose as restructuring charges fell. GAAP operating margin 10.8% against 2.9% in Q4 FY2025; non GAAP 14.0% against 9.4%. Restructuring and impairments $272.8m in Q4 and $688.6m in FY2026 after $892.0m in FY2025.
- FY2026: revenue $37.91bn, +2.0%; GAAP EPS $2.21 against $1.63, non GAAP $2.72 against $2.13. GAAP EPS includes a $536.3m pre tax China gain. Free cash flow $3.72bn; $2.82bn of long term debt repaid in FY2026, incl. the $1.32bn May 2026 tender funded with China proceeds.
- FY2027 guidance (53 weeks): revenue down about 1% incl. about $700m from the extra week; North America comparable sales about 4.0%; non GAAP operating margin 13.5% to 14.0%; non GAAP EPS $3.15 to $3.25; about 1,200 net new coffeehouses; buybacks of about $1bn to resume (stated on the call).
- Shares at $103.72 on 30 Oct 2026, 1.7% below the prior close, trade at 46.9x FY2026 GAAP EPS and 38.1x non GAAP EPS. Scenario model: base case $92 in three years; best $141; worst $45.
Figures are read from the Forms 10-K for FY2023, FY2024 and FY2025, the Forms 10-Q for Q1 to Q3 FY2026, the Forms 8-K with all their exhibits, incl. the quarterly earnings releases (Ex 99.1) for Q4 FY2023, Q4 FY2024 and Q1 FY2025 to Q4 FY2026 with their supplemental tables, the two China joint venture releases (Ex 99.1), the restructuring filings under Item 2.05, the debt tender notice and the officer and vote result filings, the CFO commentary in the releases and on the calls, the proxy statement and the DEFA14A investor presentation of 2026, Schedules 13G and Forms 4 for central index key 829224, together with the comparable filings of 10 restaurant and coffee companies used in chapters 2 to 4 and 7. Starbucks reports on fiscal years ending on the Sunday nearest 30 Sep; Q4 FY2026 is the Sep 2026 quarter (13 weeks to 27 Sep 2026). FY2026 figures come from the Form 8-K Ex 99.1 filed on 29 Oct 2026 and are unaudited; the FY2026 Form 10-K had not been filed at 31 Oct 2026. Earnings call figures come from transcript summaries and are labelled as stated on the call. China retail moved to a 40% owned joint venture with Boyu on 2 Apr 2026, so International and consolidated figures from Q3 FY2026 do not compare with earlier periods. Accession numbers appear in the Sources appendix, except for Forms 4 and the DEFA14A presentation. Market prices are last trades of 30 Oct 2026.
1 Revenue & Business Model
- Storyline: a turnaround in North America and a shift to licensing abroad. Chapters 2 to 4 cover the three revenue drivers: North America coffeehouses (76.2% of FY2026 revenue), International and China (17.8%) and Channel Development (5.7%). The financial chapters follow with margins, guidance, peers, events, ownership, risks and scenarios.
- Business model: Starbucks sells coffee, other beverages and food through company operated coffeehouses, earns royalties and product sales from licensed coffeehouses, and sells packaged coffee mainly through the Global Coffee Alliance with Nestle (Channel Development). It operated in 89 markets (FY2025 Form 10-K).
- Coffeehouses 41,607 at 27 Sep 2026, 68% licensed against 48% a year earlier: North America 10,902 company operated and 7,274 licensed; International 2,495 company operated and 20,936 licensed.
- Revenue FY2021 $29.1bn to FY2026 $37.9bn, a 5.5% CAGR; FY2021 had 53 weeks. Company operated coffeehouses earned $30.9bn in FY2026, licensed coffeehouses $4.6bn and other revenue $2.4bn.
- Countries FY2025: United States $27.1bn (72.9%), China $3.2bn (8.5%), other countries $6.9bn (18.6%). The FY2026 country split follows in the FY2026 Form 10-K.
Table 1.1 Segment revenue and operating income, FY2021 to FY2026
| Segment | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|---|
| North America revenue ($bn) | 20.45 | 23.37 | 26.57 | 27.01 | 27.37 | 28.90 |
| North America operating income ($bn) | 4.26 | 4.49 | 5.50 | 5.36 | 3.16 | 3.45 |
| North America operating margin (%) | 20.8 | 19.2 | 20.7 | 19.8 | 11.5 | 12.0 |
| International revenue ($bn) | 6.92 | 6.94 | 7.49 | 7.34 | 7.82 | 6.74 |
| International operating income ($bn) | 1.25 | 0.83 | 1.23 | 1.05 | 0.95 | 1.19 |
| International operating margin (%) | 18.0 | 12.0 | 16.4 | 14.2 | 12.1 | 17.7 |
| Channel Development revenue ($bn) | 1.59 | 1.84 | 1.89 | 1.77 | 1.87 | 2.17 |
| Channel Development operating income ($bn) | 0.79 | 0.82 | 0.97 | 0.93 | 0.89 | 1.02 |
| Channel Development operating margin (%) | 49.5 | 44.3 | 51.1 | 52.3 | 47.3 | 46.8 |
| Corporate and Other operating income ($bn) | (1.42) | (1.52) | (1.82) | (1.92) | (2.06) | (1.97) |
Segment operating income is GAAP and includes restructuring charges. FY2026 from the Form 8-K Ex 99.1 of 29 Oct 2026. International includes China company operated sales until Q2 FY2026.
Table 1.2 Revenue by type, FY2021 to FY2026 ($bn)
| Revenue line | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|---|
| Company operated coffeehouses ($bn) | 24.61 | 26.58 | 29.46 | 29.77 | 30.74 | 30.94 |
| Licensed coffeehouses ($bn) | 2.68 | 3.66 | 4.51 | 4.51 | 4.35 | 4.62 |
| Other ($bn) | 1.77 | 2.02 | 2.00 | 1.91 | 2.09 | 2.35 |
Table 1.3 Coffeehouse count at fiscal year end
| Measure | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Coffeehouses, total | 35,711 | 38,038 | 40,199 | 40,990 | 41,607 |
| Net new coffeehouses | n/a | 2,327 | 2,161 | 791 | 617 |
| U.S. coffeehouses | n/a | 16,352 | 16,941 | 16,864 | 16,781 |
| China coffeehouses | n/a | 6,806 | 7,596 | 8,011 | n/a |
China coffeehouses moved to the licensed count in Q3 FY2026 and are no longer reported separately.
2 North America Coffeehouses: Back to Starbucks
- North America revenue $7.33bn in Q4 FY2026, +6.2%; FY2026 $28.90bn, +5.6%. U.S. revenue $6.83bn, +6.3%.
- U.S. comparable sales +7.7% in Q4 (ticket +5.2%, transactions +2.4%), after +7.9% in Q3 with transactions +4.2%; FY2026 U.S. +6.5% against (2%) in FY2025 and FY2024. Management said pricing added under 1 point of ticket in Q3 and that closures, sales transfer and delivery made up about half of the Q3 U.S. comparable (stated on the call).
- Segment operating margin 12.3% in Q4 against 4.5% a year earlier; both quarters carry closure charges ($270.2m in Q4 FY2026, $628.7m in Q4 FY2025). FY2026 margin 12.0% against 20.7% in FY2023.
- Footprint: 18,176 North America coffeehouses at 27 Sep 2026 against 18,311; 584 North America closures in Q4 FY2025 and 250 in Sep 2026; FY2027 net new 90 to 100 (stated on the call).
- Loyalty: 36.0m 90 day active U.S. Rewards members (stated on the call), against 34.6m in Q1 FY2025 (8-K); the program was relaunched in Mar 2026 with Green, Gold and Reserve tiers.
Table 2.1 North America by quarter
| Line | Q4 FY2025 | Q1 FY2026 | Q2 FY2026 | Q3 FY2026 | Q4 FY2026 |
|---|---|---|---|---|---|
| North America revenue ($m) | 6,901.5 | 7,280.5 | 6,893.8 | 7,395.1 | 7,328.4 |
| North America operating income ($m) | 308.5 | 867.0 | 679.9 | 1,008.9 | 898.4 |
| North America operating margin (%) | 4.5 | 11.9 | 9.9 | 13.6 | 12.3 |
| U.S. revenue ($m) | 6,429.0 | 6,795.8 | 6,435.9 | 6,889.3 | 6,834.4 |
| North America comparable sales (%) | 0.0 | 4.0 | 7.1 | 8.1 | 7.9 |
| U.S. comparable sales (%) | (0.3) | 4.0 | 7.1 | 7.9 | 7.7 |
| U.S. comparable transactions (%) | (0.9) | 3.0 | 4.3 | 4.2 | 2.4 |
| U.S. average ticket (%) | 0.7 | 1.0 | 2.7 | 3.6 | 5.2 |
| North America coffeehouses | 18,311 | 18,360 | 18,385 | 18,371 | 18,176 |
Comparable sales for Q4 FY2025 restated to one decimal in the FY2026 releases; Q1 FY2026 printed as whole numbers. Segment operating income includes restructuring charges.
How coffee and quick service in North America are changing
- Drive thru coffee chains add units: Dutch Bros had 1,225 shops at 30 Jun 2026 against 1,043 a year earlier and revenue +32.5% in Q2 2026, with company operated same shop sales +8.3%.
- Quick service traffic is mixed: McDonald's U.S. comparable sales +0.8% in Q2 2026 with fewer guests; Chipotle comparable sales +2.1% in Q3 2026 with transactions +0.8% (8-K Ex 99.1).
- Tariff refunds: Starbucks received substantially all requested IEEPA refunds in Q3 FY2026, booked in product and distribution costs; Chipotle and Restaurant Brands also cite tariff relief in Q3 2026.
- Loyalty and digital: McDonald's reports TTM systemwide sales to loyalty members of $40bn, up more than 20%; Chipotle digital sales were 38.8% of food and beverage revenue in Q3 2026; Starbucks relaunched its Rewards tiers in Mar 2026.
Table 2.2 North America against restaurant and coffee peers ($m)
| Company and line | Period | Filed detail | Revenue | Growth (%) | Operating margin (%) |
|---|---|---|---|---|---|
| Starbucks North America | Sep 2026 quarter | U.S. comparable sales +7.7% (ticket +5.2%, transactions +2.4%) | 7,328.4 | 6.2 | 12.3 |
| McDonald's (consolidated) | Q2 2026 | U.S. comparable sales +0.8%; global +1.3% | 7,099.0 | 3.7 | 47.0 |
| Chipotle Mexican Grill | Q3 2026 | comparable sales +2.1% (check +1.3%, transactions +0.8%) | 3,293.2 | 9.6 | 13.7 |
| Dutch Bros | Q2 2026 | company operated same shop sales +8.3%, transactions +3.4%; 1,225 shops | 550.9 | 32.5 | 12.8 |
| Tim Hortons, U.S. and Canada (RBI) | Q3 2026 | comparable sales +1.5% (Canada +1.8%); margin on adjusted operating income | 1,136.0 | 1.0 | 27.9 |
McDonald's, Dutch Bros and Chipotle margins are GAAP operating income over revenue. Tim Hortons margin uses segment adjusted operating income, a non GAAP measure. Periods differ.
3 International and China: From Operator to Licensor
- International revenue $1.31bn in Q4 FY2026, (36.9%), with China as a 40% owned licensee against company operated China a year earlier; FY2026 $6.74bn, (13.8%). Excluding China, International revenue grew 5% (stated on the call).
- Operating margin 19.7% in Q4 against 10.8%; FY2026 operating income $1.19bn, +25.4%. The Q3 FY2026 10-Q says the licensed model brings lower revenue and a higher margin; Q2 FY2026 already benefited from held for sale accounting that stopped China depreciation.
- China before the joint venture: revenue $799.8m in Q2 FY2026, +8.1%; comparable sales +0.5% in Q2 FY2026 and +7% in Q1 FY2026. China comparable sales and store counts are no longer reported.
- Deal terms: Boyu funds hold 60%; Starbucks keeps 40% and the brand; pre tax gain $536.3m; net proceeds $2.54bn; Starbucks put the total value of its China retail business above $13bn and the partners aim for as many as 20,000 locations (8-K Ex 99.1, 3 Nov 2025).
- Licensed growth: International licensed revenue $557.7m in Q4, +18.4%; 20,936 licensed International coffeehouses against 12,183; about 1,100 International openings planned for FY2027, China about half (stated on the call).
Table 3.1 International by quarter, China retail as 40% owned licensee from Q3 FY2026
| Line | Q4 FY2025 | Q1 FY2026 | Q2 FY2026 | Q3 FY2026 | Q4 FY2026 |
|---|---|---|---|---|---|
| International revenue ($m) | 2,070.9 | 2,064.9 | 2,051.1 | 1,322.6 | 1,305.8 |
| International operating income ($m) | 223.2 | 282.7 | 398.6 | 252.8 | 256.9 |
| International operating margin (%) | 10.8 | 13.7 | 19.4 | 19.1 | 19.7 |
| International comparable sales (%) | 3.2 | 5.0 | 2.6 | 5.7 | 0.9 |
| China revenue, company operated ($m) | 831.6 | 823.4 | 799.8 | n/a | n/a |
| China comparable sales (%) | 2.0 | 7.0 | 0.5 | n/a | n/a |
| International coffeehouses | 22,679 | 22,758 | 22,744 | 22,933 | 23,431 |
From Q3 FY2026 International comparable sales exclude China, and International revenue includes royalties and product sales to the joint venture instead of China company operated sales.
How coffee in China and international markets is changing
- Luckin store count: 36,310 stores at 30 Jun 2026 with 2,714 net new in Q2 2026; revenue +28.5%, while self operated same store sales fell 5.3%, which Luckin attributes to delivery platform subsidies a year earlier (6-K, 3 Aug 2026).
- Yum China rolls out KCOFFEE cafes at KFC locations; delivery reached about 54% of company sales in Q2 2026 against 45%; same store sales +1% (8-K Ex 99.1, 30 Jul 2026).
- Other chains license in China: Restaurant Brands formed a Burger King China joint venture on 30 Jan 2026, keeping a 17% stake and earning royalties; Yum China agreed to acquire the Pizza Hut brand in mainland China.
Table 3.2 International against China and franchise peers ($m)
| Company and line | Period | Filed detail | Revenue | Growth (%) | Operating margin (%) |
|---|---|---|---|---|---|
| Starbucks International | Sep 2026 quarter | China as 40% owned licensee from Q3 FY2026; comparable sales +0.9%; licensed revenue +18.4% | 1,305.8 | (36.9) | 19.7 |
| Luckin Coffee | Q2 2026 | 36,310 stores; self operated same store sales (5.3%); RMB revenue converted per its 6-K | 2,336.8 | 28.5 | 13.4 |
| Yum China | Q2 2026 | same store sales +1%, transactions +5%; 19,297 stores | 3,138.0 | 12.6 | 11.1 |
| Restaurant Brands, International segment | Q3 2026 | franchise model; system sales +9.0% in constant currency; margin on adjusted operating income | 289.0 | 8.1 | 70.9 |
| McDonald's, Developmental Licensed Markets | Q2 2026 | comparable sales +1.9%, negative in China | n/a | n/a | n/a |
Starbucks International growth compares China as licensee with China company operated a year earlier. Restaurant Brands margin is adjusted operating income over revenue, a non GAAP measure. Luckin and Yum China Q3 2026 results were not filed at 31 Oct 2026.
4 Channel Development: Packaged Coffee and Bean Prices
- Channel Development revenue $494.4m in Q4 FY2026, (8.9%), after +38.8% in Q2 FY2026; FY2026 $2.17bn, +16.1%. The releases name Global Coffee Alliance revenue as the driver in both directions.
- Operating margin 53.5% in Q4 against 48.9%; FY2026 operating income $1.02bn, 46.8% margin. Income from equity investees, incl. the North American Coffee Partnership with PepsiCo, was $84.3m in Q4.
- Outlook (stated on the call): FY2027 revenue down about 10% as coffee prices fall; long term segment margin in the mid to high 40s%.
Table 4.1 Channel Development by quarter
| Line | Q4 FY2025 | Q1 FY2026 | Q2 FY2026 | Q3 FY2026 | Q4 FY2026 |
|---|---|---|---|---|---|
| Channel Development revenue ($m) | 542.6 | 522.7 | 567.8 | 587.9 | 494.4 |
| Channel Development operating income ($m) | 265.2 | 215.8 | 229.9 | 306.2 | 264.3 |
| Channel Development operating margin (%) | 48.9 | 41.3 | 40.5 | 52.1 | 53.5 |
How packaged coffee is changing
- Consolidation: Keurig Dr Pepper acquired JDE Peet's (segment net sales $2.80bn in Q2 2026) and plans to separate a coffee company with about $16bn of annual revenue in early 2027 (8-K Ex 99.1, 6 Aug 2026; revenue size from earlier KDP 8-K Ex 99.1 releases, incl. 1 Oct 2026).
- Coffee pricing: Smucker U.S. Retail Coffee net sales +13% in the Jul 2026 quarter on about 10 points of net price; segment profit +124% on tariff refunds and pricing (8-K Ex 99.1, 26 Aug 2026).
- Starbucks FY2025 Form 10-K: coffee prices rose over five years with steep increases in the last two; ready to drink runs with PepsiCo, Nestle and others; Nestle does not file with the SEC.
Table 4.2 Packaged coffee businesses compared ($m)
| Company and line | Period | Filed detail | Revenue | Growth (%) | Operating margin (%) |
|---|---|---|---|---|---|
| Starbucks Channel Development | Sep 2026 quarter | FY2026 revenue $2.17bn, +16.1%; licensed model with Nestle | 494.4 | (8.9) | 53.5 |
| J.M. Smucker, U.S. Retail Coffee | Jul 2026 quarter | segment profit $300.0m, +124%; about 10 points of price | 807.8 | 12.6 | 37.1 |
| Keurig Dr Pepper, U.S. Coffee | Q2 2026 | price +5.0%; volume and mix (8.2%) | 918.0 | (3.2) | 16.2 |
| Keurig Dr Pepper, JDE Peet's segment | Q2 2026 | consolidated for the first time in Q2 2026; GAAP operating loss $62m | 2,802.0 | n/a | n/a |
Keurig Dr Pepper U.S. Coffee margin is GAAP segment operating income over net sales; its adjusted margin is 24.5%.
5 Financial Analysis & Ratios
- FY2026 GAAP operating margin 9.7% against 7.9% in FY2025 and 15.0% in FY2024; non GAAP 11.9% against 9.9%. Restructuring and impairments of $688.6m explain most of the gap.
- Net income $2.53bn, +36.1%, incl. the $536.3m China gain; the effective tax rate was 34.2% after a change in the reinvestment assertion on China (Q1 FY2026 rate 61.7%).
- Cash: operating cash flow $4.99bn; capex $1.26bn against $2.31bn; free cash flow $3.72bn; dividends $2.82bn; no buybacks in FY2025 or FY2026.
- Balance sheet at 27 Sep 2026: total debt $13.28bn against $16.07bn; cash and investments $4.17bn; operating lease liabilities $9.14bn; shareholders' deficit (7.67bn), so ROE is not meaningful. Leverage 2.9x (stated on the Q3 FY2026 call).
Table 5.1 Income statement, cash flow and balance sheet summary ($bn unless stated)
| Line item | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Revenue | 32.3 | 36.0 | 36.2 | 37.2 | 37.9 |
| Gross profit | 8.4 | 9.8 | 9.7 | 8.5 | 8.5 |
| Selling, general and administrative | 2.0 | 2.4 | 2.5 | 2.6 | 2.4 |
| Operating income | 4.6 | 5.9 | 5.4 | 2.9 | 3.7 |
| Net income | 3.3 | 4.1 | 3.8 | 1.9 | 2.5 |
| Diluted EPS ($) | 2.83 | 3.58 | 3.31 | 1.63 | 2.21 |
| Operating cash flow | 4.4 | 6.0 | 6.1 | 4.7 | 5.0 |
| Capital expenditure | (1.8) | (2.3) | (2.8) | (2.3) | (1.3) |
| Free cash flow | 2.6 | 3.7 | 3.3 | 2.4 | 3.7 |
| Stock based compensation | 0.3 | 0.3 | 0.3 | 0.3 | 0.4 |
| Cash and investments | 3.5 | 4.2 | 3.8 | 3.7 | 4.2 |
| Total debt | 15.0 | 15.4 | 15.6 | 16.1 | 13.3 |
| Total equity | (8.7) | (8.0) | (7.4) | (8.1) | (7.7) |
FY2026 from the unaudited Form 8-K Ex 99.1. Gross profit is revenue less product and distribution costs and coffeehouse operating expenses; Starbucks does not report gross profit. Selling, general and administrative shows general and administrative expenses only. Total debt excludes operating lease liabilities. Total equity is the shareholders' deficit.
Table 5.2 What changed, Q4 FY2026 against Q4 FY2025
| Metric | Q4 FY2025 | Q4 FY2026 | Change |
|---|---|---|---|
| Revenue ($bn) | 9.57 | 9.14 | (4.5%) |
| Gross profit ($bn) | 2.16 | 2.19 | 1.0% |
| Operating income ($bn) | 0.28 | 0.99 | 256.5% |
| Net income ($bn) | 0.13 | 0.68 | 408.8% |
| Diluted EPS ($) | 0.12 | 0.59 | 391.7% |
| Operating cash flow ($bn) | 1.38 | 1.38 | 0.2% |
| Free cash flow ($bn) | 0.93 | 1.01 | 8.9% |
| Operating margin (%) | 2.9 | 10.8 | 7.9 pts |
| Net margin (%) | 1.4 | 7.4 | 6.0 pts |
Table 5.3 Ratio analysis
| Ratio | FY2022 | FY2023 | FY2024 | FY2025 | FY2026 |
|---|---|---|---|---|---|
| Growth and margins | |||||
| Revenue growth (%) | n/a | 11.6 | 0.6 | 2.8 | 2.0 |
| Gross margin (%) | 26.0 | 27.4 | 26.8 | 22.8 | 22.4 |
| Operating margin (%) | 14.3 | 16.3 | 15.0 | 7.9 | 9.7 |
| Net margin (%) | 10.2 | 11.5 | 10.4 | 5.0 | 6.7 |
| FCF margin (%) | 7.9 | 10.2 | 9.2 | 6.6 | 9.8 |
| Cost and investment intensity | |||||
| SBC (%) revenue | 0.8 | 0.8 | 0.9 | 0.9 | 1.0 |
| Capex (%) revenue | 5.7 | 6.5 | 7.7 | 6.2 | 3.3 |
| Effective tax rate (%) | 22.4 | 23.6 | 24.3 | 25.9 | 34.2 |
| Returns | |||||
| ROA (%) | 11.7 | 14.4 | 12.4 | 5.9 | 8.4 |
| Asset turnover (x) | 1.15 | 1.22 | 1.15 | 1.16 | 1.34 |
| Liquidity and leverage | |||||
| Current ratio (x) | 0.77 | 0.78 | 0.75 | 0.72 | 0.76 |
| Net cash ($bn) | (11.6) | (11.2) | (11.7) | (12.4) | (9.1) |
| Efficiency and cash quality | |||||
| Days sales outstanding | 13 | 12 | 12 | 13 | 11 |
| FCF to net income (x) | 0.78 | 0.89 | 0.88 | 1.32 | 1.47 |
| Shareholder returns (%) FCF | 246 | 93 | 116 | 113 | 76 |
ROE, ROIC and debt to equity are not meaningful with negative equity. ROA uses average total assets; asset turnover uses year end total assets.
Table 5.4 Valuation snapshot at $103.72 per share, 30 Oct 2026
| Measure | Value |
|---|---|
| Market cap ($bn) | 118.3 |
| Enterprise value ($bn) | 127.4 |
| P/E (TTM) (x) | 46.9 |
| EV/Sales (TTM) (x) | 3.4 |
| EV/EBITDA (TTM) (x) | 24.1 |
| FCF yield (%) | 3.1 |
Cost structure and profitability
- Coffeehouse operating expenses 44.1% of Q4 FY2026 revenue against 45.3% a year earlier and 46.3% in Q2 FY2026, after added labor hours under Green Apron Service and the China deconsolidation.
- Product and distribution costs 32.0% against 32.1%; 32.3% for FY2026 against 31.4%. Management named coffee prices and tariffs in 1H FY2026 and IEEPA tariff refunds in Q3 FY2026; it expects modest coffee deflation in FY2027 (stated on the calls).
- G&A $517.3m in Q4, (19.4%), 5.7% of revenue; FY2026 G&A $2.37bn, (9.3%).
- Restructuring and impairments $272.8m in Q4 FY2026, 3.0% of revenue, against $755.0m in Q4 FY2025; by segment in FY2026: North America $489.8m, Corporate and Other $103.9m, International $95.0m.
- Capex 4.1% of Q4 revenue and 3.3% for FY2026 against 6.2% in FY2025; FY2027 plan about 5% of revenue (stated on the call).
Table 5.5 Costs as % of total net revenues, last five quarters
| Line | Q4 FY2025 | Q1 FY2026 | Q2 FY2026 | Q3 FY2026 | Q4 FY2026 |
|---|---|---|---|---|---|
| Product and distribution costs (% of revenue) | 32.1 | 33.0 | 33.7 | 30.3 | 32.0 |
| Coffeehouse operating expenses (% of revenue) | 45.3 | 45.9 | 46.3 | 45.0 | 44.1 |
| General and administrative (% of revenue) | 6.7 | 6.4 | 6.5 | 6.4 | 5.7 |
| Restructuring and impairments (% of revenue) | 7.9 | 0.9 | 0.3 | 3.2 | 3.0 |
| Other operating costs and D&A, less equity investee income (derived) (% of revenue) | 5.1 | 4.8 | 4.6 | 4.5 | 4.4 |
| Operating income (% of revenue) | 2.9 | 9.0 | 8.7 | 10.5 | 10.8 |
| Non GAAP operating margin (%) | 9.4 | 10.1 | 9.4 | 14.4 | 14.0 |
| Capex (% of revenue) | 4.8 | 3.3 | 2.9 | 3.1 | 4.1 |
Table 5.6 GAAP to non GAAP, FY2025 and FY2026
| Line | FY2025 | FY2026 |
|---|---|---|
| GAAP operating income ($m) | 2,936.6 | 3,691.1 |
| Restructuring and impairments ($m) | 892.0 | 688.6 |
| Other adjustments ($m, derived) | (137.0) | 133.0 |
| Non GAAP operating income ($m) | 3,691.6 | 4,512.7 |
| GAAP operating margin (%) | 7.9 | 9.7 |
| Non GAAP operating margin (%) | 9.9 | 11.9 |
| Gain on China divestiture, pre tax ($m) | 0.0 | 536.3 |
| GAAP diluted EPS ($) | 1.63 | 2.21 |
| Non GAAP EPS ($) | 2.13 | 2.72 |
Other adjustments: China transaction and transition costs ($79.3m in FY2026), transformation costs in FY2026 and a litigation settlement received in FY2025.
Table 5.7 Cash flow and balance sheet items, FY2025 and FY2026 ($bn)
| Item | FY2025 | FY2026 |
|---|---|---|
| Operating cash flow | 4.75 | 4.99 |
| Capital expenditure | (2.31) | (1.26) |
| Net proceeds from China divestiture | 0.00 | 2.54 |
| Debt issued | 1.75 | 0.00 |
| Debt repaid | (1.25) | (2.82) |
| Dividends paid | (2.77) | (2.82) |
| Share repurchases | 0.00 | 0.00 |
| Total debt at year end | 16.07 | 13.28 |
| Cash and investments at year end | 3.71 | 4.17 |
| Operating lease liabilities at year end | 10.54 | 9.14 |
6 MD&A & Management Commentary
Q4 FY2026 results release and earnings call (29 Oct 2026)
- Q4 FY2026: revenue $9.14bn, (4.5%); GAAP operating margin 10.8%, +7.9 pts; non GAAP 14.0%, +460 bps reported and +450 bps in constant currency; GAAP EPS $0.59 against $0.12; non GAAP EPS $0.80, +54%.
- Comparable sales: global +7.2%, North America +7.9%, U.S. +7.7%, International +0.9% (excluding China). Management said over 80% of North America company operated coffeehouses had positive comparable sales, against under 50% a year earlier (stated on the call).
- Segment margins: North America 12.3% GAAP after $270.2m of restructuring, about 16% non GAAP (stated on the call); International 19.7%; Channel Development 53.5%.
- Costs: G&A $517.3m, (19.4%); more than half of the $2bn gross cost savings program through FY2028 achieved (stated on the call); restructuring $272.8m, mostly for about 250 North America closures in Sep 2026.
- Customers and coffeehouses (stated on the call): 36.0m 90 day active U.S. Rewards members; 1,700+ coffeehouse uplifts in FY2026 and 2,000+ planned in FY2027; daily inventory deliveries to close to 90% of North America company operated coffeehouses; matcha described as a $1bn+ platform.
- Q3 FY2026 (29 Jul 2026): revenue $9.32bn, (1%); global comparable sales +7.9%; non GAAP operating margin 14.4%; IEEPA tariff refunds largely offset tariffs of the first three quarters of the fiscal year; non GAAP EPS raised to $2.55 to $2.65.
Table 6.1 Company outlook with every FY2026 revision and FY2027 guidance
| Item | Outlook | Source |
|---|---|---|
| FY2026, first outlook | global and U.S. comparable sales +3% or more; non GAAP operating margin slightly higher; non GAAP EPS $2.15 to $2.40 (GAAP $1.74 to $1.99); 600 to 650 net new coffeehouses | 8-K Ex 99.1, 28 Jan 2026 |
| FY2026, raised | comparable sales +5.0% or more; revenue roughly flat as China moves to a licensee; non GAAP EPS $2.25 to $2.45 (GAAP $1.73 to $1.93 before the China gain) | 8-K Ex 99.1, 28 Apr 2026 |
| FY2026, raised again | U.S. comparable sales slightly above 6.0%, global nearing 6.0%; Q4 U.S. +6.5% or more; revenue flat to slightly up; non GAAP operating margin above 11.0%; non GAAP EPS $2.55 to $2.65 (GAAP $2.14 to $2.24) | 8-K Ex 99.1, 29 Jul 2026 |
| FY2026 net new coffeehouses, cut | about 440, from 600 to 650, after about 250 North America closures | 8-K Items 2.05 and 7.01, 24 Sep 2026 |
| FY2026 actual | global comparable sales +6.2%, U.S. +6.5%; revenue +2.0%; non GAAP operating margin 11.9%; non GAAP EPS $2.72, GAAP $2.21; 617 net new coffeehouses | 8-K Ex 99.1, 29 Oct 2026 |
| FY2027 revenue and comparable sales | revenue down about 1% on a 53 week basis incl. about $700m from the 53rd week; North America comparable sales about 4.0% (52 week basis) | 8-K Ex 99.1, 29 Oct 2026 |
| FY2027 margin and EPS | non GAAP operating margin 13.5% to 14.0%; non GAAP EPS $3.15 to $3.25 incl. slightly more than $0.10 from the 53rd week; GAAP EPS $3.07 to $3.17 after $0.13 of restructuring | 8-K Ex 99.1, 29 Oct 2026 |
| FY2027 coffeehouses | about 1,200 net new: International about 1,100 (China about half), North America 90 to 100 (about half licensed) | 8-K Ex 99.1; stated on the Q4 FY2026 call |
| FY2027 capital and other | buybacks of about $1bn; capex about 5% of revenue; quarterly dividend $0.63 from $0.62; International margin about 20%; Channel Development revenue down about 10%; G&A flat to slightly down; pricing below CPI | stated on the Q4 FY2026 call; 8-K Ex 99.1 |
| FY2028 | operating margin target 13.5% to 15% by FY2028, with the CEO saying the low end would be reached in FY2027; $2bn of gross cost savings through FY2028 | stated on the Q4 FY2026 call (company call transcript); $2bn savings through FY2028 also on the Q3 FY2026 call |
Management and CFO commentary
- CFO Cathy Smith, 8-K Ex 99.1 of 29 Oct 2026: FY2027 revenue down about 1% incl. about $700m from the 53rd week, mainly from China moving to a licensed joint venture; non GAAP operating margin 13.5% to 14.0%; share repurchases to resume in FY2027.
- CFO, Q4 FY2026 call (stated on the call): non GAAP EPS growth of about 18% at the guidance midpoint; future comparable sales guidance to center on North America company operated coffeehouses; consolidated G&A flat to slightly down; tax rate in line with or slightly below FY2026.
- CFO, Q3 FY2026 call (stated on the call): about $1.8bn of debt repaid with China proceeds; leverage 2.9x; normalized product and distribution cost rate 32.3% year to date against 30.3% reported in Q3; uplifts at about $150,000 each.
- Q2 FY2026 release (8-K Ex 99.1, 28 Apr 2026): North America product and distribution costs 30.0% of segment revenue against 27.9% a year earlier; consolidated 33.7% against 31.2%.
- CEO Brian Niccol, 8-K Ex 99.1 of 29 Oct 2026: about 250 underperforming North America coffeehouses closed in Sep 2026; Back to Starbucks described as the growth plan.
- CFO, 8-K Ex 99.1 of 29 Jul 2026: FY2026 non GAAP EPS raised to $2.55 to $2.65; GAAP $2.14 to $2.24 incl. a $0.47 China gain and $0.48 of restructuring.
Table 6.2 Management statements in their own words
| Speaker | Date and source | Statement |
|---|---|---|
| Brian Niccol, chairman and CEO | 29 Oct 2026, 8-K Ex 99.1 | “Back to Starbucks started as our turnaround plan. Now, it's our growth plan.” |
| Cathy Smith, CFO | 29 Oct 2026, 8-K Ex 99.1 | “In fiscal 2026, we returned to comp growth, expanded margin and delivered stronger earnings” |
| Cathy Smith, CFO | 28 Apr 2026, 8-K Ex 99.1 | “We've been clear that topline improvement would come first, with earnings growth to follow.” |
Table 6.3 Key disclosures in the Forms 10-K and 10-Q
| Item | Disclosure |
|---|---|
| Q3 FY2026 10-Q: China divestiture | Transaction closed in Q3 FY2026; Boyu funds hold 60%, Starbucks 40% and licenses brand and IP. Disposal group deconsolidated; JV share now in income from equity investees. Company expects lower revenue and higher operating margin vs the company operated model. Pre tax gain $536.3m; net proceeds $2.54bn (9M cash flow). |
| Q3 FY2026 10-Q: restructuring | FY2025 plan store closures substantially done in NA in FY2025 and International in Q1 FY2026. Q2 FY2026 plan relocates support functions to a new Nashville office. Q3 FY2026 plan targets support organization, non retail facilities and Reserve and Roastery asset group impairment. |
| Q3 FY2026 10-Q: results drivers | Q3 NA company operated revenue up on 7.9% US comp ($524m); licensed revenue +$95m incl. $53m from the China JV; G&A down $120m from restructuring savings ($174m) and lapping Leadership Experience 2025 ($81m); D&A down 60 bps of revenue after China held for sale. |
| Q3 FY2026 10-Q: liquidity and debt | About $1.3bn notes repurchased in May 2026 tender with China proceeds; about $1.1bn of cash and short term investments held in foreign subsidiaries at Jun 28 2026; no borrowings under the $3.0bn revolver. |
| Item 1A: concentration | North America was about 74% of FY2025 net revenues and is the main source of operating cash flow; Channel Development is described as heavily reliant on Nestle; licensed operations concentrated among a few large licensees. |
| Item 1A: labor | Unions hold representation rights at around 6% of more than 10,000 U.S. company operated stores; first contract bargaining ongoing; work stoppages have occurred. |
| Item 5 | About 16,000 holders of record (Nov 7 2025); no repurchases in Q4 FY2025; 29.8m shares remained under the repurchase authorization at Sep 28 2025. Five year TSR to Sep 28 2025: SBUX $110.47 vs S&P 500 $214.30 per $100. |
| Item 8: debt | $3.0bn unsecured revolving credit facility replaced in Q3 FY2025, matures Jun 13 2030, expandable by $1.0bn; $3.0bn commercial paper program backstopped by the facility; no amounts drawn at FY2025 end. |
| Item 8: deferred revenue | Noncurrent deferred revenue $5.77bn at FY2025 end, of which $5.6bn is the Nestle upfront prepaid royalty recognized over about 40 years (current portion $177m). |
7 Peer Valuation & Sector Summary
- Sector: coffee chains and quick service restaurants. Starbucks FY2026 revenue $37.9bn against McDonald's TTM $27.7bn and Chipotle $12.7bn; McDonald's operating margin of 46.2% reflects a mostly franchised model.
- Growth, latest quarter: YUM 12.3%, CMG 9.6%, MCD 3.7%, DPZ 3.4%, QSR 3.1%, SBUX (4.5%) after the China deconsolidation.
- Operating margin: MCD 46.2% TTM, CMG 14.1%, SBUX 9.7% GAAP and 11.9% non GAAP in FY2026.
- Valuation: SBUX 3.36x EV/Sales and 46.9x GAAP P/E (38.1x non GAAP) against MCD 8.0x and 21.0x, CMG 3.08x and 29.7x, QSR 4.6x and DPZ 2.95x EV/Sales.
Table 7.1 Peer comparison, latest reported trailing twelve months
| Company | Revenue TTM ($bn) | Revenue growth (%) | Gross margin (%) | Operating margin (%) | Net margin (%) | FCF margin (%) | ROE (%) | Net cash ($bn) | Market value ($bn) | EV/Sales (x) | P/E TTM (x) |
|---|---|---|---|---|---|---|---|---|---|---|---|
| SBUX | 37.9 | (4.5) | 22.4 | 9.7 | 6.7 | 9.8 | n/a | (9.1) | 118 | 3.4 | 46.9 |
| MCD | 27.7 | 3.7 | n/a | 46.2 | 31.7 | n/a | n/a | (39.0) | 183 | 8.0 | 21.0 |
| CMG | 12.7 | 9.6 | n/a | 14.1 | 10.8 | n/a | 52.1 | 1.0 | 40 | 3.1 | 29.7 |
| YUM | 8.7 | 12.3 | n/a | n/a | n/a | n/a | n/a | n/a | 42 | n/a | n/a |
| QSR | 9.8 | 3.1 | n/a | n/a | n/a | n/a | n/a | (12.3) | 33 | 4.6 | n/a |
| DPZ | 5.1 | 3.4 | n/a | n/a | n/a | n/a | n/a | (4.7) | 10 | 3.0 | n/a |
SBUX FY2026 to 27 Sep 2026, growth Q4 FY2026 year on year, reduced by the China deconsolidation; non GAAP operating margin 11.9% and P/E 38.1x on non GAAP EPS. MCD and YUM TTM to Jun 2026, CMG and QSR TTM to Sep 2026, DPZ TTM to 6 Sep 2026; growth is the latest quarter year on year. Margins, net debt and P/E are blank where the statements were not extracted. Gross margin for SBUX is revenue less product, distribution and coffeehouse operating costs. Prices are last trades of 30 Oct 2026.
Table 7.2 Latest quarter by business, all drivers
| Business | Period | Revenue ($m) | Growth (%) | Operating margin (%) |
|---|---|---|---|---|
| Starbucks North America | Sep 2026 quarter | 7,328.4 | 6.2 | 12.3 |
| McDonald's (consolidated) | Q2 2026 | 7,099.0 | 3.7 | 47.0 |
| Chipotle Mexican Grill | Q3 2026 | 3,293.2 | 9.6 | 13.7 |
| Dutch Bros | Q2 2026 | 550.9 | 32.5 | 12.8 |
| Tim Hortons, U.S. and Canada (RBI) | Q3 2026 | 1,136.0 | 1.0 | 27.9 |
| Starbucks International | Sep 2026 quarter | 1,305.8 | (36.9) | 19.7 |
| Luckin Coffee | Q2 2026 | 2,336.8 | 28.5 | 13.4 |
| Yum China | Q2 2026 | 3,138.0 | 12.6 | 11.1 |
| Starbucks Channel Development | Sep 2026 quarter | 494.4 | (8.9) | 53.5 |
| J.M. Smucker, U.S. Retail Coffee | Jul 2026 quarter | 807.8 | 12.6 | 37.1 |
| Keurig Dr Pepper, U.S. Coffee | Q2 2026 | 918.0 | (3.2) | 16.2 |
Restaurant Brands segment margins use adjusted operating income, a non GAAP measure. Luckin in RMB converted to US dollars as stated in its 6-K.
8 Material Events & Contracts
- 12 Forms 8-K in twelve months: four earnings releases, two China joint venture releases, two restructuring filings under Item 2.05, the debt tender settlement, two officer filings and the annual meeting vote results. No Ex 10 or Ex 2 exhibits were attached.
- China joint venture: agreed on 3 Nov 2025, closed on 2 Apr 2026; pre tax gain $536.3m; net proceeds $2.54bn; $2.82bn of long term debt repaid in FY2026, incl. the $1.32bn tender of May 2026 funded with China proceeds.
- Restructuring: plans of May 2026 (about $400m, support organization, non retail facilities, Reserve and Roastery) and Sep 2026 (about $300m, about 250 North America closures) followed the Sep 2025 plan of about $1bn.
Table 8.1 Forms 8-K filed in the last twelve months
| Date | Items | Event |
|---|---|---|
| 3 Nov 2025 | 7.01, 9.01 | Agreement to form China retail JV with Boyu Capital: Boyu up to 60%, Starbucks 40% plus brand licence; enterprise value about $4bn (cash free, debt free); Starbucks expects total China value above $13bn (sale proceeds, retained stake, net present value of licence fees); about 8,000 stores, aspiration up to 20,000; close expected Q2 FY2026. |
| 14 Nov 2025 | 5.02, amendment | Brad Lerman ceased to serve as executive vice president and chief legal officer on Nov 14 2025; stays in advisory role during transition. |
| 28 Jan 2026 | 2.02, 9.01 | Q1 FY2026: revenue $9.92bn (+6%); global comps +4% (transactions +3%); US comps +4%; China comps +7%; GAAP EPS $0.26 (tax rate 61.7% on China held for sale reinvestment assertion change); non GAAP EPS $0.56; FY2026 guidance introduced. |
| 30 Mar 2026 | 5.07 | Annual meeting Mar 25 2026: 11 directors elected; say on pay approved; Deloitte ratified; shareholder proposal to replace supermajority voting passed; independent chair and four report proposals failed. |
| 2 Apr 2026 | 7.01, 9.01 | China JV with Boyu Capital closed: Boyu funds hold 60%, Starbucks 40% and continues to own and license brand and IP; about 8,000 company operated coffeehouses move to licensed model. |
| 28 Apr 2026 | 2.02, 9.01 | Q2 FY2026: revenue $9.53bn (+9%); global comps +6.2% (transactions +3.8%); US +7.1%; China +0.5%; GAAP EPS $0.45, non GAAP $0.50; FY2026 comps and EPS guidance raised; loyalty program relaunched with three tiers in March. |
| 15 May 2026 | 2.05 | Board approved (May 13) restructuring of support organization, non retail facilities and Reserve and Roastery locations: about $400m charges ($280m non cash impairment incl. ROU assets, $120m cash severance), mostly in FY2026; part of $2bn cost savings goal; international moving to nearly 90% licensed. |
| 20 May 2026 | 8.01 | Settled cash tender offers: $1.32bn principal of notes purchased (4.8% 2030 $321.8m, 4.5% 2028 $273.5m, 4.5% 2048 $200.0m, 5.4% 2035 $410.2m, 5.0% 2034 $110.4m) using China proceeds. |
| 12 Jun 2026 | 5.02 | Val Bauduin (SVP Corporate Finance and Development, 50) designated principal accounting officer from Jun 11 2026; CFO Cathy Smith remains principal financial officer. |
| 29 Jul 2026 | 2.02, 9.01 | Q3 FY2026: revenue $9.32bn (down 1%) as China deconsolidated; global comps +7.9%; US +7.9%; GAAP EPS $0.91 incl. $536.3m pre tax gain on China divestiture; non GAAP EPS $0.85; about $1.3bn notes tendered; FY2026 guidance raised. |
| 24 Sep 2026 | 2.05, 7.01 | Board approved (Sep 22) closing about 1% of 18,000+ North America coffeehouses (about 250 closed in September): about $300m charges ($200m cash for lease exits and severance, $100m non cash asset impairment), mostly in FY2026. |
| 29 Oct 2026 | 2.02, 9.01 | Q4 FY2026: revenue $9.14bn (down 4%); global comps +7.2%; US +7.7%; GAAP EPS $0.59, non GAAP $0.80 (+54%); FY2026 revenue $37.91bn (+2%), GAAP EPS $2.21, non GAAP $2.72; dividend $0.63; FY2027 guidance issued. |
Table 8.2 Material contracts and financing arrangements
| Contract | Terms |
|---|---|
| China joint venture with Boyu Capital | Agreed 3 Nov 2025, closed 2 Apr 2026: Boyu funds 60%, Starbucks 40%; Starbucks owns and licenses the brand and IP; enterprise value about $4bn for Boyu's purchase; net proceeds $2.54bn; equity investments $1.78bn at 27 Sep 2026. |
| Senior notes and tender offer | Long term debt $11.78bn plus $1.50bn current at 27 Sep 2026; $1.32bn of five note series bought in the May 2026 tender for about $1.30bn; $2.82bn repaid in FY2026. |
| Revolving credit facility and commercial paper | $3.0bn unsecured facility maturing 13 Jun 2030, expandable by $1.0bn; backs a $3.0bn commercial paper program; undrawn at FY2025 end and at Q3 FY2026. |
| Global Coffee Alliance with Nestle | Nestle holds global rights to distribute certain Starbucks packaged goods; $5.6bn up front prepaid royalty recognized over about 40 years; noncurrent deferred revenue $5.58bn at 27 Sep 2026. |
| North American Coffee Partnership with PepsiCo | Ready to drink joint venture; Channel Development income from equity investees $84.3m in Q4 FY2026. |
| Restructuring plans | Sep 2025 plan about $1bn; May 2026 plan about $400m ($280m non cash, $120m cash); Sep 2026 plan about $300m ($200m cash, $100m non cash); Nashville office relocation not quantified. |
9 Ownership, Voting Power & Annual Meeting
- One share, one vote; no controlling holder. Capital Research Global Investors held 9.0%, Capital World Investors 8.2% and Vanguard Capital Management 7.51% in their latest Schedules 13G.
- 2026 annual meeting (25 Mar 2026): all 11 directors elected, Andy Campion with the most votes against (12.7% of votes cast); say on pay approved with 88.6% of for and against votes; a shareholder proposal to replace supermajority voting passed; an independent chair proposal received 12.4%.
- Insiders, 12 months to 31 Oct 2026: one open market purchase, director Jorgen Vig Knudstorp, 11,700 shares at $85.00 (about $0.99m); open market sales of about $2.24m by two officers under preset trading plans, Brady Brewer (CEO International) and Sara Kelly (chief partner officer). CEO Brian Niccol and CFO Cathy Smith only withheld shares for taxes on vesting.
- Pay design (DEFA14A, Mar 2026): Back to Starbucks PRSUs vest after FY2027 only if cumulative operating expense savings exceed $800m, then on service, platform launch, 2,250 uplift and loyalty milestones, with a TSR modifier; the FY2025 bonus paid 39.7% of target.
Table 9.1 Annual meeting vote results, 25 Mar 2026
| Proposal | For (bn votes) | Against (bn votes) | Abstain (bn votes) | For as % of votes cast | Result |
|---|---|---|---|---|---|
| Elect Andy Campion | 0.765 | 0.111 | 0.001 | 87.3 | Elected |
| Elect Marissa Mayer | 0.868 | 0.008 | 0.001 | 99.1 | Elected |
| Elect Brian Niccol | 0.830 | 0.043 | 0.003 | 95.1 | Elected |
| Say on pay (advisory) | 0.775 | 0.099 | 0.003 | 88.6 | Approved |
| Ratify Deloitte and Touche for FY2026 | 0.965 | 0.038 | 0.001 | 96.2 | Approved |
| Shareholder: replace supermajority voting with majority voting | 0.824 | 0.018 | 0.031 | 97.9 | Approved |
| Shareholder: independent board chair policy | 0.108 | 0.764 | 0.005 | 12.4 | Not approved |
| Shareholder: report on detransitioning healthcare coverage | 0.008 | 0.861 | 0.008 | 0.9 | Not approved |
| Shareholder: report on median compensation and benefits gaps (reproductive and gender dysphoria care) | 0.005 | 0.865 | 0.007 | 0.6 | Not approved |
| Shareholder: report on diagnostic tools from politicized corporate partners | 0.006 | 0.863 | 0.007 | 0.7 | Not approved |
| Shareholder: report on excluding religious charities from gift match | 0.006 | 0.864 | 0.007 | 0.7 | Not approved |
One vote per share. Broker non votes 127,972,619 on most items; none on the auditor ratification.
2026 annual meeting
- Meeting of 25 Mar 2026: Brian Niccol cited more than $500m invested in added hours and staffing under Green Apron Service and over 1,000 coffeehouse uplifts planned by the end of FY2026.
- Chief partner officer Sara Kelly: about 250,000 North America partners, under 5% with union representation; pay and benefits above $30 per hour on average.
- No numerical guidance was given at the meeting; management said it engaged with holders of nearly 43% of shares, and half of the directors joined since 2024.
Table 9.2 Largest holders from Schedules 13G
| Holder | Shares (m) | Share of class (%) | As of |
|---|---|---|---|
| Capital Research Global Investors | 102.4 | 9.0 | 31 Mar 2026 |
| Capital World Investors | 92.9 | 8.2 | 30 Jun 2026 |
| Vanguard Capital Management | 85.6 | 7.51 | 31 Mar 2026 |
One class of common stock with one vote per share; no controlling holder. Capital World Investors held 104.8m shares (9.2%) at 31 Mar 2026. Vanguard Group reported 113.9m shares (10.01%) at 31 Oct 2025 and then split its reporting entities.
10 Risk Factors
- Item 1A of the FY2025 Form 10-K holds 29 risk factors against 30 and 8,000 words against 13,324; the Forms 10-Q for Q1 to Q3 FY2026 report no material change. The FY2026 Form 10-K had not been filed at 31 Oct 2026.
Table 10.1 Risks with filed figures
| Risk | Disclosure and change |
|---|---|
| Dependence on North America | About 74% of FY2025 revenue and the main source of operating cash flow (FY2025 Form 10-K); 76.2% of FY2026 revenue after the China deconsolidation. |
| China joint venture and licensees | China now earns royalties, product sales and a 40% equity share; the FY2025 Form 10-K points to large regional licensees; International is moving to nearly 90% licensed (8-K, 15 May 2026). |
| Coffee prices and tariffs | New standalone tariff factor in FY2025; product and distribution costs 32.3% of FY2026 revenue against 31.4% in FY2025 (8-K Ex 99.1, 29 Oct 2026). |
| Restructuring execution | $892.0m of charges in FY2025 and $688.6m in FY2026; FY2027 GAAP guidance includes $0.13 per share; savings depend on estimates (Item 1A). |
| Labor and unions | Unions represent around 6% of more than 10,000 U.S. company operated coffeehouses; first contract bargaining ongoing; work stoppages added to Item 1A. |
| Channel Development partners | Segment described as heavily reliant on Nestle; Q4 FY2026 revenue (8.9%) on Global Coffee Alliance revenue; FY2027 revenue down about 10% (stated on the call). |
| Leverage | Debt $13.28bn plus operating lease liabilities $9.14bn against a shareholders' deficit of $7.67bn; Item 1A adds credit rating downgrade risk. |
How risk factors changed
- Comparison: 10-K FY2025 (52 weeks to 28 Sep 2025) filed 14 Nov 2025 acc 0000829224-25-000114 against 10-K FY2024 (52 weeks to 29 Sep 2024) filed 20 Nov 2024 acc 0000829224-24-000057.
- Item 1A was cut from 13,324 to 8,000 words (40% fewer) and from 30 to 29 factors; 25 of 29 factors were rewritten, and the summary of risks list at the start of the FY2024 section was dropped.
- China is named once in FY2025 (privacy law) against 15 times in 4 factors in FY2024; the FY2025 10-K was filed 11 days after the 3 Nov 2025 agreement to sell up to 60% of China retail operations to Boyu Capital.
- Tariffs get a standalone factor and appear 8 times in 5 factors against 6 times in 4 factors; the macroeconomic factor adds the One Big Beautiful Bill Act and credit rating risk.
- AI is named in 5 factors against 3, now covering marketing analytics, AI regulation, AI driven privacy rules and model errors such as hallucinations and bias.
- The restructuring plan and strategic transactions incl. divestitures and joint ventures enter the strategic initiatives heading; the ESG group is renamed 'Responsible Business Matters'; union representation is stated as around 6% of more than 10,000 US company operated stores against 'hundreds' a year earlier, with work stoppages added.
Table 10.2 Size of the risk factor section
| Measure | 10-K FY2024 | 10-K FY2025 |
|---|---|---|
| Risk factors (count) | 30 | 29 |
| Words in Item 1A | 13,324 | 8,000 |
Table 10.3 Risk factors added, removed and materially reworded
| Change | Risk factor | What changed |
|---|---|---|
| Added | Trade policy, tariffs and import/export rules | New standalone factor: new, increased, threatened or retaliatory tariffs, quotas, embargoes, sanctions and customs restrictions have in the past adversely affected, and could again affect, results and relationships with customers, suppliers and employees. |
| Removed | Customer experience and technology investments may underperform | FY2024 factor on investments in digital engagement, mobile ordering and delivery dropped as a standalone item; digital and convenience formats now sit in the information technology factor. |
| Removed | U.S. and international economic conditions, incl. China volatility | FY2024 factor naming China consumer confidence, lower priced competitors and China Taiwan tensions dropped; its consumer spending text was folded into the general macroeconomic factor. |
| Reworded | Value of our brand | Cut from 751 to 460 words; drops the reference to environmental and social program goals and adds that social media, video and messaging platforms spread issues before the company can respond, and that third party objections to company positions can trigger boycotts. |
| Reworded | Brand, marketing, promotional, advertising and pricing strategies | Heading adds 'brand'; adds the need to build marketing, data analytics (incl. AI and machine learning) and innovation capabilities; drops the sentence on gradual menu price increases to offset inflation. |
| Reworded | Strategic initiatives, incl. restructuring plan, and strategic transactions | Heading now names the restructuring plan and strategic transactions; lists Back to Starbucks initiatives (service model, closing and redesigning coffeehouses, transforming the support organization) and adds that divestitures, partnerships and joint ventures may not deliver expected benefits and can lead to impairment reviews. |
| Reworded | Consumer preferences and health effects | Cut from 339 to 142 words; adds that the company has misjudged demand for new products, leading to excess or short inventory and markdowns. |
| Reworded | Business partners and third party providers | Shortened from 297 to 184 words; adds noncompliance with sanitation protocols by partners as an example. |
| Reworded | Food and beverage safety incidents | Rewritten; adds reliance on third party suppliers for ingredients and finished products and higher risk from temperature controlled offerings through equipment failure or human error. |
| Reworded | New store openings and store attractiveness | Cut from 378 to 190 words; risks of site selection, permits, contractors and costs condensed into one list, adds remodeling and maintenance spending. |
| Reworded | Dependence on North America segment | Adds that North America is the primary source of operating cash flow, so weaker results could limit funding of international expansion and strategic initiatives. |
| Reworded | Dependence on international markets | Heading changes from 'increasingly dependent on the success of certain international markets' to 'licensed and company owned international markets'; the FY2024 paragraph on the China MBU as the second largest, 100% company operated market and its risk list (US China tension, anti Americanism, boycotts) is removed; text now points to large regional licensees and key company owned markets. |
| Reworded | Risks as a global business | Cut from 506 to 269 words; now cites operations in 89 markets and adds sanctions limiting sourcing, local employment laws and fund repatriation to the list. |
| Reworded | Reliance on key business partners | Adds that failure by large regional licensees or Channel Development partners to meet development and renovation targets could hurt key markets; Nestle is described as holding global rights to distribute certain Starbucks branded packaged goods. |
| Reworded | Arabica coffee and commodity costs | Cut from 558 to 259 words; adds tariffs and speculative trading as price drivers, the limited ability to fully hedge, and cocoa, eggs and meats among other commodities. |
| Reworded | Supply chain capacity | Cut from 218 to 105 words; adds inaccurate forecasting, insufficient inventory and overestimated demand for new products. |
| Reworded | Supply chain interruption and supplier reliance | Cut from 262 to 121 words; adds dependence on a limited number of suppliers. |
Showing 14 of 25 materially reworded factors.
Table 10.4 Risk factor updates in quarterly reports since the annual filing
| Filing | Change disclosed |
|---|---|
| 10-Q Q1 FY2026 (Dec 2025 quarter) filed 28 Jan 2026 | No material changes to the risk factors in the 10-K. |
| 10-Q Q2 FY2026 (Mar 2026 quarter) filed 28 Apr 2026 | No material changes to the risk factors in the 10-K. |
| 10-Q Q3 FY2026 (Jun 2026 quarter) filed 29 Jul 2026 | No material changes to the risk factors in the 10-K. |
11 Stock Price, Scenarios & Sensitivity
- SBUX last traded at $103.72 on 30 Oct 2026, the day after results, 1.7% below the prior close of $105.51; 6.1% below the 52 week high of $110.51 (Aug 2026) and 33.0% above the lowest monthly low of $78.00 (Nov 2025).
- Valuation: 46.9x FY2026 GAAP EPS of $2.21 and 38.1x non GAAP EPS of $2.72; 3.36x EV/Sales excluding leases; dividend yield 2.43% on the $0.63 quarterly dividend; market value $118.3bn.
- Scenario model: GAAP revenue grows from FY2026 for three years; operating margin as stated; net interest expense of $386.3m (FY2026) held flat; 24% tax rate; price equals FY2029 EPS times exit P/E. FY2027 has 53 weeks.
Critical factors and core assumptions
Table 11.1 Critical factors behind the best case
| Factor | Current value | Best case requires | Evidence in filings and calls |
|---|---|---|---|
| North America comparable sales | FY2026 +6.6%; Q4 +7.9% (ticket +5.0%, transactions +2.7%) | about 4% in FY2027 and 3%+ after, with positive transactions | 8-K Ex 99.1, 29 Oct 2026; FY2027 guidance |
| Operating margin | FY2026 non GAAP 11.9%, GAAP 9.7%; Q4 non GAAP 14.0% | GAAP margin near 16% by FY2029 as restructuring charges end | FY2027 guidance 13.5% to 14.0%; FY2028 target 13.5% to 15% (stated on the call) |
| Cost savings | over half of $2bn gross savings achieved; FY2026 G&A (9.3%) | full $2bn by FY2028 with savings kept in margin | Q3 and Q4 FY2026 calls; 8-K Item 2.05, 15 May 2026 |
| International licensing and China | 20,936 International licensed coffeehouses; International margin 19.7% in Q4 | about 1,100 International openings a year and margin of 20% or more | Q4 FY2026 call; Forms 8-K on the Boyu joint venture |
| Coffee and tariff costs | product and distribution costs 32.3% of FY2026 revenue against 31.4% | modest coffee deflation as guided and no new tariffs | Q3 and Q4 FY2026 calls; Item 1A |
| Capital returns | net debt $9.10bn excluding leases; dividends $2.82bn; no buybacks | about $1bn of buybacks a year with an investment grade rating kept | Q4 FY2026 call; 8-K Ex 99.1 |
- Base: FY2026 revenue $37.91bn; GAAP operating income $3.69bn (9.7% margin); non GAAP 11.9%.
- Best case: 6% revenue CAGR, 16% operating margin, 30x P/E, share count (3%) from buybacks.
- Base case: 3% revenue CAGR after about (1%) in FY2027 per guidance, 14% GAAP margin, 25x P/E, share count (2%) from about $1bn of buybacks a year.
- Worst case: flat revenue as North America comparable sales fade, 11% margin, 18x P/E, share count unchanged.
- Tax rate 24%; net interest expense held at the FY2026 level; equity income from the China joint venture stays inside operating income.
Scenarios, three years forward
Table 11.2 Scenario analysis, FY2026 to FY2029
| Measure | Worst case | Base case | Best case |
|---|---|---|---|
| Revenue CAGR, 3 years (%) | 0.0 | 3.0 | 6.0 |
| Revenue, FY2029 ($bn) | 37.9 | 41.4 | 45.2 |
| Operating margin, FY2029 (%) | 11.0 | 14.0 | 16.0 |
| Net income, FY2029 ($bn) | 2.9 | 4.1 | 5.2 |
| EPS, FY2029 ($) | 2.52 | 3.68 | 4.70 |
| Exit P/E (x) | 18.0 | 25.0 | 30.0 |
| Implied price ($) | 45 | 92 | 141 |
| Change against $103.72 (%) | (56) | (11) | 36 |
| Implied annual return (%) | (24.1) | (3.9) | 10.8 |
Implied annual return excludes dividends ($0.63 per share quarterly). Margins are GAAP; FY2027 guidance is non GAAP.
Sensitivity analysis
Table 11.3 Sensitivity of implied price to revenue CAGR and operating margin at 25x P/E
| Revenue CAGR \ Operating margin | 11% | 13% | 14% | 15% | 16% |
|---|---|---|---|---|---|
| 0% | $64 | $77 | $84 | $90 | $97 |
| 2% | $69 | $82 | $89 | $96 | $103 |
| 3% | $71 | $85 | $92 | $99 | $106 |
| 5% | $76 | $90 | $98 | $105 | $113 |
| 6% | $78 | $93 | $101 | $109 | $116 |
Cells show implied share price in year 3. Last trade of 30 Oct 2026 $103.72. Blue cells sit above it, red cells below.
Table 11.4 Sensitivity of implied price to exit P/E and operating margin at 3% revenue CAGR
| Exit P/E \ Operating margin | 11% | 13% | 14% | 15% | 16% |
|---|---|---|---|---|---|
| 18x | $51 | $61 | $66 | $71 | $76 |
| 21x | $60 | $71 | $77 | $83 | $89 |
| 25x | $71 | $85 | $92 | $99 | $106 |
| 28x | $79 | $95 | $103 | $111 | $119 |
| 30x | $85 | $102 | $110 | $119 | $127 |
Cells show implied share price in year 3. Last trade of 30 Oct 2026 $103.72. Blue cells sit above it, red cells below.
Disclaimer
This analysis is for information only and is not financial advice. It is derived from public SEC filings retrieved via sec-api.io and is not a publication of the U.S. Securities and Exchange Commission. Scenario values are model outputs under stated assumptions and are not forecasts. Data as of 31 October 2026.
Sources
All company figures are read from SEC filings retrieved through the sec-api.io MCP server. Call statements are taken from the Q2, Q3 and Q4 FY2026 earnings calls and the 2026 annual meeting held by the company and are labelled as stated on the call.
Table A.1 Filings used, with accession numbers
| Form | Period | Filed | Accession number |
|---|---|---|---|
| 8-K Ex 99.1 | Q4 FY2026 / FY2026 | 29 Oct 2026 | 0000829224-26-000154 |
| 8-K Ex 99.1 | Q3 FY2026 | 29 Jul 2026 | 0000829224-26-000129 |
| 10-Q | Q3 FY2026 | 29 Jul 2026 | 0000829224-26-000130 |
| 8-K Ex 99.1 | Q2 FY2026 | 28 Apr 2026 | 0000829224-26-000078 |
| 8-K Ex 99.1 | Q1 FY2026 | 28 Jan 2026 | 0000829224-26-000010 |
| 10-K | FY2025 | 14 Nov 2025 | 0000829224-25-000114 |
| 10-K | FY2023 | 17 Nov 2023 | 0000829224-23-000058 |
| 8-K Ex 99.1 | Q4 FY2025 | 29 Oct 2025 | 0000829224-25-000074 |
| 8-K Ex 99.1 | Q3 FY2025 | 29 Jul 2025 | 0000829224-25-000057 |
| 8-K Ex 99.1 | Q2 FY2025 | 29 Apr 2025 | 0000829224-25-000033 |
| 8-K Ex 99.1 | Q1 FY2025 | 28 Jan 2025 | 0000829224-25-000013 |
| 8-K Ex 99.1 | Q4 FY2024 | 30 Oct 2024 | 0000829224-24-000051 |
| 8-K Ex 99.1 | Q4 FY2023 | 2 Nov 2023 | 0000829224-23-000051 |
| 8-K Ex 99.1 (Boyu JV announcement) | 3 Nov 2025 | 0000829224-25-000079 | |
| 8-K Ex 99.1 (Boyu JV close) | 2 Apr 2026 | 0000829224-26-000064 | |
| 8-K 2.05 | 24 Sep 2026 | 0000829224-26-000145 | |
| 8-K 2.05 | 15 May 2026 | 0000829224-26-000088 | |
| 8-K 2.05 | 25 Sep 2025 | 0000829224-25-000067 | |
| 8-K 8.01 | 20 May 2026 | 0000829224-26-000094 | |
| 8-K 5.07 | 30 Mar 2026 | 0000829224-26-000058 | |
| DEF 14A | 2026 meeting | 26 Jan 2026 | 0001213900-26-007780 |
Table A.2 Further Starbucks, holder and peer filings used
| Company | Form | Filed | Accession number |
|---|---|---|---|
| Starbucks | 10-K FY2024 | 20 Nov 2024 | 0000829224-24-000057 |
| Starbucks | 10-Q Q1 FY2026 | 28 Jan 2026 | 0000829224-26-000011 |
| Starbucks | 10-Q Q2 FY2026 | 28 Apr 2026 | 0000829224-26-000080 |
| Starbucks | 8-K | 14 Nov 2025 | 0000829224-25-000117 |
| Starbucks | 8-K | 12 Jun 2026 | 0000829224-26-000106 |
| Capital Research Global Investors | Schedule 13G | 31 Mar 2026 | 0001422848-26-000083 |
| Capital World Investors | Schedule 13G | 30 Jun 2026 | 0001422849-26-000151 |
| Vanguard Capital Management | Schedule 13G | 31 Mar 2026 | 0002100119-26-001124 |
| McDonald's | 10-Q | 2026 (latest 10-Q) | 0000063908-26-000073 |
| Chipotle Mexican Grill | 10-Q | 2026 (latest 10-Q) | 0001058090-26-000104 |
| Yum! Brands | 10-Q | 2026 (latest 10-Q) | 0001041061-26-000160 |
| Restaurant Brands International | 10-Q | 2026 (latest 10-Q) | 0001618756-26-000056 |
| Domino's Pizza | 10-Q | 2026 (latest 10-Q) | 0001286681-26-000040 |
| Chipotle Mexican Grill | 8-K Ex 99.1 | 28 Oct 2026 | 0001058090-26-000103 |
| Dutch Bros | 8-K Ex 99.1 | 5 Aug 2026 | 0001866581-26-000131 |
| J.M. Smucker | 8-K Ex 99.1 | 26 Aug 2026 | 0000091419-26-000079 |
| Keurig Dr Pepper | 8-K Ex 99.1 | 6 Aug 2026 | 0001418135-26-000048 |
| Luckin Coffee | 6-K Ex 99.1 | 3 Aug 2026 | 0001104659-26-089437 |
| McDonald's | 8-K Ex 99.1 | 4 Aug 2026 | 0000063908-26-000067 |
| Restaurant Brands International | 8-K Ex 99 | 29 Oct 2026 | 0001618756-26-000051 |
| Yum China | 8-K Ex 99.1 | 30 Jul 2026 | 0001193125-26-324793 |
Table B.1 Exhibits to Forms 8-K filed in the last twelve months
| Filed | Exhibit | Document | Content |
|---|---|---|---|
| 3 Nov 2025 | EX-99.1 | Press release: Starbucks and Boyu Capital agree China retail joint venture | Boyu Capital to hold up to 60% of Starbucks retail operations in China; Starbucks retains 40% and keeps ownership and licensing of brand and intellectual property; Boyu acquires its interest at a cash free, debt free enterprise value of about $4bn |
| 14 Nov 2025 | 8-K amendment body (Item 5.02, no exhibits) | Chief legal officer Brad Lerman steps down | Amendment to a 4 Jun 2025 8-K; Mr. Lerman ceased serving as executive vice president and chief legal officer at close of business on 14 Nov 2025; He remains with the company in an advisory capacity during a transition period |
| 28 Jan 2026 | EX-99.1 | Q1 FY2026 earnings release (Dec 2025 quarter) with supplemental tables | Net revenues $9.92bn, up 6% (5% constant currency); global and US comparable store sales up 4% (transactions up 3%, ticket up 1%); first US comparable transaction growth in eight quarters; China comparable sales up 7%; GAAP operating margin 9.0% (down 290 bps), non GAAP 10.1% (down 180 bps) on Back to Starbucks labor investment, coffee prices and tariffs; North America margin 11.9% vs 16.7% |
| 30 Mar 2026 | 8-K body (Item 5.07, no exhibits) | 2026 annual meeting voting results (meeting held 25 Mar 2026) | All 11 director nominees elected; Marissa Mayer received the most support (867.97m for, 7.93m against), Andy Campion the least (764.75m for, 110.98m against); Brian Niccol 830.35m for, 43.09m against; Say on pay approved: 774.93m for, 99.36m against, 2.58m abstain |
| 2 Apr 2026 | EX-99.1 | Press release: Starbucks and Boyu Capital close China joint venture | Joint venture closed 2 Apr 2026; funds managed by Boyu Capital hold 60% of Starbucks China retail operations, Starbucks retains 40%; Starbucks continues to own and license the brand and intellectual property to the joint venture |
| 28 Apr 2026 | EX-99.1 | Q2 FY2026 earnings release (Mar 2026 quarter) with supplemental tables | Net revenues $9.53bn, up 9% (8% constant currency); global comparable sales up 6.2% (transactions up 3.8%, ticket up 2.3%); North America and US up 7.1%; China up 0.5%; GAAP operating margin 8.7% (up 180 bps), non GAAP 9.4% (up 120 bps); North America margin 9.9% vs 11.6%, International 19.4% vs 11.6% as China depreciation stopped under held for sale |
| 15 May 2026 | 8-K body (Item 2.05, no exhibits) | Restructuring plan: support organization, non retail facilities, Reserve and Roastery | Board approved plan on 13 May 2026 under the Back to Starbucks strategy; Company restates it is pursuing $2bn in cost savings and that nearly 90% of international coffeehouses are licensed |
| 20 May 2026 | 8-K body (Item 8.01, no exhibits) | Settlement of debt tender offers | Settled cash tender offers on 20 May 2026 under Offer to Purchase dated 4 May 2026, upsized 15 May 2026; Principal accepted across five series totals about $1.32bn for a total purchase price of about $1.30bn including accrued interest |
| 12 Jun 2026 | 8-K body (Item 5.02, no exhibits) | Val Bauduin named principal accounting officer | Val Bauduin, 50, senior vice president Corporate Finance and Development, designated principal accounting officer on 11 Jun 2026; Cathy Smith remains evp, CFO and principal financial officer |
| 29 Jul 2026 | EX-99.1 | Q3 FY2026 earnings release (Jun 2026 quarter) with supplemental tables | Net revenues $9.32bn, down 1% as China moved to licensed joint venture; global comparable sales up 7.9% (transactions up 4.2%, ticket up 3.5%); North America up 8.1%, US up 7.9%, International up 5.7%; GAAP operating margin 10.5% (up 60 bps), non GAAP 14.4% (up 430 bps); IEEPA tariff refunds received in quarter largely offset tariffs from the first three quarters; restructuring and impairments $303m |
| 24 Sep 2026 | 8-K body (Items 2.05 and 7.01, no exhibits) | North America coffeehouse closures and lower FY2026 net new store guidance | Board approved on 22 Sep 2026 closing about 1% of more than 18,000 North America coffeehouses that miss experience and financial expectations; About $300m of restructuring charges: about $200m cash (lease exits, employee separation) and $100m non cash asset disposal and impairment; most closures by end of FY2026 |
| 29 Oct 2026 | EX-99.1 | Q4 and full FY2026 earnings release (Sep 2026 quarter) with supplemental tables and FY2027 guidance | Q4 FY2026: net revenues $9.14bn, down 4% on China conversion; global comparable coffeehouse sales up 7.2% (ticket up 5.2%, transactions up 1.8%); North America up 7.9%, US up 7.7%, International up 0.9%; Q4 GAAP operating margin 10.8% (up 790 bps), non GAAP 14.0% (up 460 bps reported, 450 bps constant currency); GAAP EPS $0.59, non GAAP EPS $0.80 (up 54%); restructuring $273m mostly from about 250 North America closures |
