10-Q – 2026-04-28 – sbux-20260329.htm

For the quarter ended March 29, 2026, compared with the quarter ended March 30, 2025
Revenues
International total net revenues for the second quarter of fiscal 2026 increased $184 million, or 10%, primarily driven by higher product sales to, and royalty revenues from, our licensees ($74 million), primarily due to the opening of 321 net-new licensed stores over the past 12 months. Additional contributing factors were favorable foreign currency translation impacts ($40 million), an increase in company-operated stores revenue due to a 2.6% increase in comparable store sales ($37 million), driven by a 2.1% increase in comparable transactions and a 0.5% increase in average ticket, and net-new company-operated store growth of 3%, or 261 stores, over the past 12 months ($35 million).
Operating Margin
International operating income for the second quarter of fiscal 2026 increased 84% to $399 million, compared to $217 million in the second quarter of fiscal 2025. Operating margin expanded 780 basis points to 19%, primarily due to lower store operating and depreciation and amortization costs after classifying assets for Starbucks retail operations in China as held for sale (approximately 520 basis points), and sales leverage (430 basis points), partially offset by inflationary pressures (approximately 120 basis points), primarily driven by elevated coffee pricing.
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For the two quarters ended March 29, 2026, compared with the two quarters ended March 30, 2025
Revenues
International total net revenues for the first two quarters of fiscal 2026 increased $378 million, or 10%, primarily driven by higher product sales to, and royalty revenues from, our licensees ($132 million), primarily due to the opening of 321 net-new licensed stores over the past 12 months. Also contributing was an increase in company-operated stores revenue due to a 3.9% increase in comparable store sales ($108 million), driven by a 2.5% increase in comparable transactions and a 1.4% increase in average ticket, as well as net-new company-operated store growth of 3%, or 261 stores, over the past 12 months ($85 million), and favorable foreign currency translation impacts ($51 million).
Operating Margin
International operating income for the first two quarters of fiscal 2026 increased 50% to $681 million, compared to $454 million in the first two quarters of fiscal 2025. Operating margin expanded 450 basis points to 17%, primarily due to sales leverage (420 basis points) and lower store operating and depreciation and amortization costs after classifying assets for Starbucks retail operations in China as held for sale (approximately 340 basis points), partially offset by inflationary pressures (approximately 160 basis points), primarily driven by elevated coffee pricing, and restructuring costs associated with the closure of coffeehouses (approximately 90 basis points).

Channel Development 

Quarter Ended Two Quarters Ended
  Mar 29,
2026 Mar 30,
2025 $
Change
Mar 29,
2026 Mar 30,
2025 Mar 29,
2026 Mar 30,
2025 $
Change Mar 29,
2026 Mar 30,
2025
As a % of Channel Development
Total Net Revenues As a % of Channel Development
Total Net Revenues
Net revenues $ 567.8  $ 409.0  $ 158.8  $ 1,090.5  $ 845.3  $ 245.2 
Product and distribution costs 370.5  257.7  112.8  65.3  % 63.0  % 723.1  517.5  205.6  66.3  % 61.2  %
Other operating expenses 17.7  15.0  2.7  3.1  3.7  31.5  28.4  3.1  2.9  3.4 

General and administrative expenses 0.7  1.2  (0.5) 0.1  0.3  1.9  3.1  (1.2) 0.2  0.4 
Restructuring and impairments (0.1) 0.9  (1.0) 0.0  0.2  0.1  0.9  (0.8) 0.0  0.1 
Total operating expenses 388.8  274.8  114.0  68.5  67.2  756.6  549.9  206.7  69.4  65.1 
Income from equity investees 50.9  59.3  (8.4) 9.0  14.5  111.8  106.2  5.6  10.3  12.6 

Operating income $ 229.9   $ 193.5   $ 36.4   40.5   % 47.3   % $ 445.7   $ 401.6   $ 44.1   40.9   % 47.5   %

For the quarter ended March 29, 2026, compared with the quarter ended March 30, 2025
Revenues
Channel Development total net revenues for the second quarter of fiscal 2026 increased $159 million, or 39%, primarily due to an increase in revenue in the Global Coffee Alliance ($149 million).
Operating Margin
Channel Development operating income for the second quarter of fiscal 2026 increased 19% to $230 million, compared to $194 million in the second quarter of fiscal 2025. Operating margin contracted 680 basis points to 41%, primarily driven by lower income from the North American Coffee Partnership joint venture relative to segment revenue growth (approximately 550 basis points) and other product mix shifts (160 basis points).

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For the two quarters ended March 29, 2026, compared with the two quarters ended March 30, 2025
Revenues
Channel Development total net revenues for the first two quarters of fiscal 2026 increased $245 million, or 29%, primarily due to an increase in revenue in the Global Coffee Alliance ($222 million).
Operating Margin
Channel Development operating income for the first two quarters of fiscal 2026 increased 11% to $446 million, compared to $402 million in the first two quarters of fiscal 2025. Operating margin contracted 660 basis points to 41%, primarily driven by product mix shifts (approximately 470 basis points) and lower North American Coffee Partnership joint venture income growth relative to segment revenue growth (230 basis points).

Corporate and Other
  Quarter Ended Two Quarters Ended
Mar 29,
2026 Mar 30,
2025 $
Change
%
Change
Mar 29,
2026 Mar 30,
2025 $
Change
%
Change

Net revenues:

Other $ 18.8  $ 12.8  $ 6.0  46.9  % $ 65.8  $ 31.1  $ 34.7  111.6  %
Total net revenues 18.8   12.8   6.0   46.9   65.8   31.1   34.7   111.6  
Product and distribution costs 19.5  13.0  6.5  50.0  56.9  32.4  24.5  75.6 

Other operating expenses 1.2  —  1.2  nm 2.1  0.2  1.9  950.0 
Depreciation and amortization expenses 31.3  30.7  0.6  2.0  63.3  60.0  3.3  5.5 
General and administrative expenses 436.0  449.7  (13.7) (3.0) 883.3  923.8  (40.5) (4.4)
Restructuring and impairments 11.1  77.2  (66.1) (85.6) 15.4  77.2  (61.8) (80.1)
Total operating expenses 499.1  570.6  (71.5) (12.5) 1,021.0  1,093.6  (72.6) (6.6)

Operating loss $ (480.3) $ (557.8) $ 77.5   (13.9) % $ (955.2) $ (1,062.5) $ 107.3   (10.1) %

Corporate and Other primarily consists of our unallocated corporate expenses and sales of cocoa butter to third parties. Unallocated corporate expenses include corporate administrative functions that support the operating segments but are not specifically attributable to or managed by any segment and are not included in the reported financial results of the operating segments.
For the quarter ended March 29, 2026, compared with the quarter ended March 30, 2025
Corporate and Other operating loss decreased 14% to $480 million for the second quarter of fiscal 2026 compared to $558 million for the second quarter of fiscal 2025, primarily due to lower costs associated with restructuring our support organization ($66 million), primarily severance costs, in support of our “Back to Starbucks” strategy.
For the two quarters ended March 29, 2026, compared with the two quarters ended March 30, 2025
Corporate and Other operating loss decreased 10% to $955 million for the first two quarters of fiscal 2026 compared to $1.1 billion for the first two quarters of fiscal 2025, primarily due to restructuring-related savings in the current year ($111 million) and lower costs associated with restructuring our support organization ($62 million), primarily severance costs, in support of our “Back to Starbucks” strategy, partially offset by transaction-related expenses for the strategic partnership with Boyu Capital to operate Starbucks retail in China ($24 million) and increases in performance-based compensation ($20 million).
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Quarterly Store Data
Our store data for the periods presented is as follows:
  Net stores opened/(closed) and transferred during the period (1)
   
  Quarter Ended Two Quarters Ended Stores open as of
Mar 29,
2026 Mar 30,
2025 Mar 29,
2026 Mar 30,
2025 Mar 29,
2026 Mar 30,
2025
North America
Company-operated stores 44  89  104  170  11,122  11,331 
Licensed stores (19) 1  (30) 33  7,263  7,296 
Total North America 25  90  74  203  18,385  18,627 
International
Company-operated stores (2)
(10) 91  (61) 317  10,435  10,174 
Licensed stores (2)
(4) 32  126  70  12,309  11,988 
Total International (14) 123  65  387  22,744  22,162 

Total Company 11   213   139   590   41,129   40,789  

(1) Includes 62 and 227 stores closed in the quarter and two quarters ended March 29, 2026, respectively, as part of our “Back to Starbucks” restructuring plan.
(2) Includes the conversion of 113 licensed stores to company-operated stores following the acquisition of 23.5 Degrees Topco Limited during the first quarter of fiscal 2025.

Financial Condition, Liquidity, and Capital Resources
Cash and Investment Overview
Our cash and investments were $2.0 billion as of March 29, 2026, and $3.7 billion as of September 28, 2025. We actively manage our cash and investments in order to internally fund operating needs, make scheduled interest and principal payments on our borrowings, fund acquisitions, and return cash to shareholders through common stock cash dividend payments and share repurchases. Our investment portfolio primarily includes highly liquid available-for-sale securities, including corporate debt securities and U.S. government treasury securities. As of March 29, 2026, approximately $0.8 billion of cash and short-term investments were held in foreign subsidiaries, excluding cash balances for Starbucks retail operations in China that were classified as held for sale.
Borrowing Capacity
Credit Facilities and Commercial Paper
Revolving Credit Facility
Our $3.0 billion unsecured five-year revolving credit facility (the “2025 credit facility”), of which $150.0 million may be used for issuances of letters of credit, is currently set to mature on June 13, 2030. The 2025 credit facility is available for working capital, capital expenditures, and other general corporate purposes, including acquisitions and share repurchases. We have the option, subject to negotiation and agreement with the related banks, to increase the maximum commitment amount by an additional $1.0 billion.
Borrowings under the 2025 credit facility will bear interest at a fluctuating rate based on the Term Secured Overnight Financing Rate (“Term SOFR”), and, for U.S. dollar-denominated loans under certain circumstances, a Base Rate (as defined in the 2025 credit facility), in each case plus an applicable rate. The applicable rate is based on the Company’s long-term credit ratings assigned by Moody’s and Standard & Poor’s rating agencies. The 2025 credit facility contains alternative interest rate provisions specifying rate calculations to be used at such time Term SOFR ceases to be available as a benchmark due to reference rate reform. The “Base Rate” of interest is the highest of (i) the Federal Funds Rate plus 0.50%, (ii) Bank of America’s prime rate, (iii) Term SOFR plus 1.00%, and (iv) 1.00%. Upon the occurrence of any event of default under the
2025 credit facility, interest on the outstanding amount of the indebtedness under the 2025 credit facility will bear interest at a rate per annum equal to 2% in excess of the interest then borne by such borrowings.
The 2025 credit facility contains provisions requiring us to maintain compliance with certain covenants, including a minimum fixed charge coverage ratio, which measures our ability to cover financing expenses. As of March 29, 2026, we were in compliance with all applicable covenants. No amounts were outstanding under our 2025 credit facility as of March 29, 2026, or September 28, 2025.
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Commercial Paper
Under our commercial paper program, we may issue unsecured commercial paper notes up to a maximum aggregate amount outstanding at any time of $3.0 billion, with individual maturities that may vary but not exceed 397 days from the date of issue. Amounts outstanding under the commercial paper program are required to be backstopped by available commitments under our 2025 credit facility. The proceeds from borrowings under our commercial paper program may be used for working capital needs, capital expenditures, and other corporate purposes, including, but not limited to, business expansion, payment of cash dividends on our common stock, and share repurchases. We had no borrowings outstanding under our commercial paper program as of March 29, 2026 and September 28, 2025. Our total available contractual borrowing capacity for general corporate purposes was $3.0 billion as of the end of our second quarter of fiscal 2026.
Credit Facilities in Japan
Additionally, we hold the following Japanese yen-denominated credit facilities that are available for working capital needs and capital expenditures within our Japanese market:
• A ¥5.0 billion, or $31.3 million, credit facility is currently set to mature on December 30, 2026. Borrowings under this credit facility are subject to terms defined within the facility and will bear interest at a variable rate based on TIBOR plus an applicable margin of 0.400%.
• A ¥10.0 billion, or $62.6 million, credit facility is currently set to mature on March 27, 2027. Borrowings under this credit facility are subject to terms defined within the facility and will bear interest at a variable rate based on TIBOR plus an applicable margin of 0.300%.
As of March 29, 2026, and September 28, 2025, we had no borrowings outstanding under these credit facilities.
See Note 8, Debt, to the consolidated financial statements included in Item 1 of Part I of this 10-Q for details of the components of our long-term debt.
Our ability to incur new liens and conduct sale and leaseback transactions on certain material properties is subject to compliance with terms of the indentures under which the long-term notes were issued. As of March 29, 2026, we were in compliance with all applicable covenants.
Use of Cash
We expect to use our available cash and investments, including, but not limited to, additional potential future borrowings under the credit facilities, commercial paper program, and the issuance of debt to support and invest in our core businesses, including investing in new ways to serve our customers and supporting our store partners, repaying maturing debts, returning cash to shareholders through common stock cash dividend payments and discretionary share repurchases, and investing in new business opportunities related to our core and developing businesses. Furthermore, we may use our available cash resources to make proportionate capital contributions to our investees. We may also seek strategic acquisitions to leverage existing capabilities and further build our business. Acquisitions may include increasing our ownership interests in our investees. Any decisions to increase such ownership interests will be driven by valuation and fit with our ownership strategy.
We believe that net future cash flows generated from operations and existing cash and investments both domestically and internationally, combined with our ability to leverage our balance sheet through the issuance of debt, will be sufficient to finance capital requirements for our core businesses as well as shareholder distributions for at least the next 12 months. Aside from the proceeds from our divestiture of Starbucks retail operations in China, we are currently not aware of any trends or demands, commitments, events, or uncertainties that will result in, or that are reasonably likely to result in, our liquidity increasing or decreasing in any material way that will impact our capital needs during or beyond the next 12 months. We currently plan to use the proceeds from our divestiture for Starbucks retail operations in China for debt reduction, strengthening our balance sheet and allowing us to execute our long-term growth strategy with greater financial flexibility.
We have borrowed funds and continue to believe we have the ability to do so at reasonable interest rates; however, additional borrowings would result in increased interest expense in the future. In this regard, we may incur additional debt, within targeted levels, as part of our plans to fund our capital programs, including cash returns to shareholders through future dividends and discretionary share repurchases, refinancing debt maturities, as well as investing in new business opportunities. If necessary, we may pursue additional sources of financing, including both short-term and long-term borrowings and debt issuances.
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We regularly review our cash positions and our determination of partial indefinite reinvestment of foreign earnings. In the event we determine that all or another portion of such foreign earnings are no longer indefinitely reinvested, we may be subject to additional foreign withholding taxes, which could be material. Any foreign earnings that are not indefinitely reinvested may be repatriated at management’s discretion. In the first quarter of fiscal 2026, we released all of our remaining indefinite reinvestment assertions and recorded a discrete tax expense of $266 million, which was subsequently increased in the second quarter of fiscal 2026 by $8 million. In future periods, any foreign earnings may be repatriated at management’s discretion without any material, incremental tax consequences.
On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act ( IEEPA) were unlawful. Starbucks imports were previously subject to such tariffs under IEEPA. Effective April 20, 2026, the U.S. Customs and Border Protection launched a platform for importers of record to begin submitting IEEPA tariff refund requests. As the timing and amount of any recovery are uncertain, we are unable to estimate the financial effects, if any, at this time. We will continue to evaluate new information and will recognize the refund when the right to receive any amounts becomes probable and estimable.
During the second quarter of fiscal 2026, our Board of Directors approved a quarterly cash dividend to shareholders of $0.62 per share to be paid on May 29, 2026, to shareholders of record as of the close of business on May 15, 2026.
During the two quarters ended March 29, 2026, we made no common stock share repurchases. As of March 29, 2026, 29.8 million shares of common stock remained available for repurchase under current authorizations.
Other than normal operating expenses, cash requirements for the remainder of fiscal 2026 are expected to consist primarily of repayments of long-term debt, as well as capital expenditures for investments in our new and existing stores, our supply chain, and corporate facilities. Total capital expenditures for fiscal 2026 are expected to be moderately lower than fiscal 2025.
In the MD&A included in the 10-K, we disclosed that we had $36.5 billion of current and long-term material cash requirements as of September 28, 2025. There have been no material changes to our material cash requirements during the period covered by this 10-Q outside of the normal course of our business.
Cash Flows
Cash provided by operating activities was $2.0 billion for the first two quarters of fiscal 2026, compared to $2.4 billion for the same period in fiscal 2025. The change was primarily due to a decrease in cash flow of $380.8 million in Accounts Payable, which was primarily driven by payment timing, and a decrease in net earnings of $361.1 million. These impacts were partially offset by a net increase in cash flow of $375.4 million in deferred income taxes primarily related to the change in indefinite reinvestment assertion as a result of classifying our Starbucks retail operations in China as held for sale.
Cash used in investing activities totaled $653.3 million for the first two quarters of fiscal 2026, compared to $1.5 billion for the same period in fiscal 2025. The change was primarily due to a net decrease in capital expenditures of $685.7 million, driven by a reduction in new store investments and retail renovations in North America and global non-retail facilities spend, and lapping the acquisition of 23.5 Degrees Topco Limited in the first quarter of fiscal 2025.
Cash used in financing activities for the first two quarters of fiscal 2026 totaled $2.4 billion, compared to $1.4 billion for the same period in fiscal 2025. The change was primarily due to a $1.0 billion repayment of long-term debt in the current year.

Commodity Prices, Availability and General Risk Conditions
Commodity price risk represents our primary market risk, generated by our purchases of green coffee and dairy products, among other items. We purchase, roast, and sell high-quality arabica coffee and related products, and risk arises from the price volatility of green coffee. In addition to coffee, we also purchase significant amounts of dairy products to support the needs of our company-operated stores. The price and availability of these commodities, including impacts from volatility in green coffee prices and new tariffs, directly impact our results of operations, and we expect commodity prices, particularly coffee, to continue to impact future results of operations. For additional details, see Product Supply in Part 1, Item 1 of the 10-K, as well as Risk Factors in Part I, Item 1A of the 10-K.

Seasonality and Quarterly Results
Our business is subject to moderate seasonal fluctuations, of which our fiscal second quarter typically experiences lower revenues and operating income. Additionally, as our stored value cards (“Starbucks Cards”) are issued to, and loaded by, customers during the holiday season, we tend to have higher cash flows from operations during the first quarter of the fiscal year. However, since revenues from Starbucks Cards are recognized upon redemption and not when cash is loaded onto the Starbucks Cards, the impact of seasonal fluctuations on the consolidated statements of earnings is much less pronounced. As a result of moderate seasonal fluctuations, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.
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Critical Accounting Estimates
The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions, and estimates that affect the amounts reported. Note 1 , Summary of Significant Accounting Policies, to the consolidated financial statements included in Item 1 of Part I of this 10-Q and in the Notes to Consolidated Financial Statements in Part II, Item 8 of the 10-K describe the significant accounting policies and methods used in the preparation of the Company’s consolidated financial statements. There have been no material changes to the Company’s critical accounting estimates since the 10-K.

RECENT ACCOUNTING PRONOUNCEMENTS
See Note 1 , Summary of Significant Accounting Policies, to the consolidated financial statements included in Item 1 of Part I of this 10-Q, for a detailed description of recent accounting pronouncements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk
There has been no material change in the commodity price risk, foreign currency exchange risk, equity security price risk, or interest rate risk discussed in Item 7A of the 10-K.

Item 4. Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Our disclosure controls and procedures are also designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
During the second quarter of fiscal 2026, we carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based upon that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were effective, as of the end of the period covered by this report (March 29, 2026).
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during our most recently completed fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings
See Note 15 , Commitments and Contingencies, to the consolidated financial statements included in Item 1 of Part I of this 10-Q for information regarding certain legal proceedings in which we are involved.

Item 1A. Risk Factors
In addition to the other information set forth in this 10-Q, you should carefully consider the risks and uncertainties discussed in Part I, Item 1A. Risk Factors in our 10-K. There have been no material changes to the risk factors disclosed in our 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Shares under our ongoing share repurchase program may be repurchased in open market transactions, including pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act, or through privately negotiated transactions. The timing, manner, price, and amount of repurchases will be determined at our discretion and the share repurchase program may be suspended, terminated, or modified at any time for any reason. During the second fiscal quarter ended March 29, 2026, there was no share repurchase activity.

Item 3. Defaults upon Senior Securities
None.

Item 4. Mine Safety Disclosures
Not applicable.

Item 5. Other Information

Insider Adoption or Termination of Trading Arrangements:

During the fiscal quarter ended March 29, 2026, none of our directors or officers informed us of the adoption or termination of a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Regulation S-K, Item 408.
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Item 6. Exhibits

    Incorporated by Reference  
Exhibit
No.
Exhibit Description Form File No. Date of
Filing
Exhibit Number Filed
Herewith

3.1
Restated Articles of Incorporation of Starbucks Corporation
10-Q 000-20322 4/28/2015 3.1
3.2
Amended and Restated Bylaws of Starbucks Corporation (As amended and restated through June 25, 2025)
8-K 000-20322 6/30/2025 3.1
31.1
Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
— — — — X
31.2
Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
— — — — X
32*
Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
— — — — —
101 The following financial statements from the Company’s 10-Q for the fiscal quarter ended March 29, 2026, formatted in iXBRL: (i) Consolidated Statements of Earnings, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Equity, and (vi) Notes to Consolidated Financial Statements
— — — — X
104 Cover Page Interactive Data File (formatted in iXBRL and contained in Exhibit 101) — — — — X

* Furnished herewith.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
April 28, 2026
 
STARBUCKS CORPORATION

By: /s/ Cathy R. Smith

Cathy R. Smith

executive vice president, chief financial officer
Signing on behalf of the registrant and as
principal financial officer

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