Starbucks has launched a sweeping turnaround plan that includes shuttering underperforming outlets and cutting approximately 900 non-retail positions, aiming to revitalize growth amid slipping sales. The restructuring is expected to carry a price tag of around $1 billion.
Under the plan, Starbucks will permanently close hundreds of its coffeehouses—amounting to roughly 1% of its North American footprint. The number of stores in the region is projected to shrink from 18,734 to about 18,300 by the end of the fiscal year. CEO Brian Niccol stated the closures would target locations “where we don’t see a path to financial performance or where we are unable to create the physical environment our customers and partners expect.”
Affected staffers are to be notified in the near term. Many will be offered transfers to nearby outlets when feasible, while others will receive severance and support packages. In parallel, around 900 roles in corporate and support functions will be eliminated, with some employees being asked to work remotely during the transition.
Niccol described the restructuring as part of Starbucks’ broader “Back to Starbucks” plan—an effort to sharpen focus on customer experience, cost discipline, and operational clarity. He said that early enhancements to stores—such as staffing optimizations and improved layouts—have already begun yielding better customer engagement.
The decision comes as Starbucks grapples with a six-quarter stretch of declining same-store sales in the U.S., pressured by changing consumer behavior and elevated competition. The company is also evaluating a possible stake sale in its China operations, where growth has decelerated.
Investors reacted cautiously to the news. Starbucks stock showed little movement following the announcement, though the outlook for margins and cost control is now under greater scrutiny.
As Starbucks navigates this pivot, its success will depend on how effectively it balances store closures, employee morale, and investment in core locations to return to a sustainable growth path.