Starbucks Q4 2026 earnings: profit beats estimates as turnaround gains traction

October 29, 2026 · Published October 30, 2026

Starbucks topped profit expectations in Q4 2026 as comparable sales jumped 7.2% globally, even as total revenue fell because the company sold its China retail business.

Key takeaways

• Adjusted earnings per share came in above what analysts had expected for Q4 2026, a sign that CEO Brian Niccol’s “Back to Starbucks” turnaround plan — which has focused on faster service, menu simplification and store-level fixes — is starting to show up in the bottom line. The unadjusted (GAAP) profit figure was lower, since it includes one-time restructuring and other charges tied to that plan.
• Total revenue fell from a year earlier and came in below analyst estimates, but that drop isn’t a sign of a weakening core business — it mainly reflects Starbucks having sold its China retail operations earlier in the year, which removed that business’s revenue from this year’s results entirely.
• Comparable sales — a closer measure of how existing stores are actually performing, stripping out the effect of new openings, closures and the China sale — rose 7.2% worldwide. North America led with a 7.9% increase and the U.S. alone was up 7.7%, while international markets grew a much slower 0.9%.
• Most of that comparable-sales growth came from customers spending more per visit (a higher average ticket) rather than from more customers coming in, suggesting the recovery is still being driven more by pricing and menu mix than by a rebound in foot traffic.
• Profitability improved for the quarter, with the operating margin (the share of revenue left after running the business, before interest and taxes) at roughly 11% on a GAAP basis and 14% on an adjusted basis — both better than recent quarters as cost-saving efforts and the sales pickup began to offset heavy spending on the turnaround.
• Over the trailing twelve months, Starbucks’ overall profit margin remains thin at about 5% of revenue, and per-share earnings over that longer stretch are still down sharply from a year earlier — a reminder that this quarter’s rebound follows several weaker quarters earlier in the turnaround when the company was absorbing restructuring costs and investing in stores before sales growth caught up.
• Starbucks kept expanding during the quarter, opening 303 net new coffeehouses and ending with 41,607 locations worldwide, the majority of which are licensed rather than company-operated.
• The company’s reported return on equity is unusually high, largely because Starbucks has funded years of stock buybacks with debt, which shrinks the equity base the return is measured against — it reflects the company’s capital structure more than an extraordinary jump in profitability.
• Management has pointed to continued strength in the U.S. and North America as evidence the turnaround plan is taking hold, while flagging that international markets, excluding China, are recovering more slowly.

Fundamentals

Sources: company report · reputable coverage