Starbucks sales miss expectations, but its U.S. turnaround is gaining steam

Starbucks on Thursday reported mixed quarterly results as its international cafes underperformed expectations.

However, its U.S. turnaround continues to take hold, as its home market topped expectations during the coffee giant's final quarter of fiscal 2026.

"We enter fiscal 2027 with momentum, a clear set of priorities and higher ambitions for what Starbucks can become," CEO Brian Niccol said in a video shared on the company's website.

Starbucks is ahead of schedule to meet the fiscal 2028 targets laid out at its investor day in January, he said on the company's earnings conference call.

For fiscal 2027, Starbucks is projecting adjusted earnings per share in a range of $3.15 to $3.25, above Wall Street's expectations of earnings per share of $3.14. However, its anticipated revenue decline of 1% is weaker than expected; analysts were forecasting net sales growth of 1.4%.

Starbucks is projecting North American same-store sales growth of 4% for the fiscal year.

The company's earnings and revenue outlook includes an additional week and the effects of the shift in its China business to a joint venture business model. Starbucks is also projecting slight deflation in coffee prices and slowing net new North American cafe openings, which will both weigh on its full-year revenue, according to CFO Cathy Smith.

Here's what the company reported for the quarter ended Sept. 27 compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

Starbucks reported fiscal fourth-quarter net income attributable to the company of $677.2 million, or 59 cents per share, up from $133.1 million, or 12 cents per share, a year earlier.

Excluding restructuring and impairment costs and other items, the company reported earnings per share of 80 cents.

Net revenue fell 4% to $9.14 billion, reflecting the joint venture deal in China.

The company's global same-store sales increased 7.2%, fueled by growth in average ticket, and beating Wall Street estimates of 6%, according to StreetAccount. Transactions grew 1.8% in the quarter.