Starbucks to close 250 North American cafes and cut opening targets in $300 million restructuring

Store closures and financial costs

Starbucks announced in a regulatory filing on 24 September 2026 that it will shutter 250 underperforming coffeehouses across North America. The closures represent roughly 1% of the chain's network of more than 18,000 regional locations, which stood at 18,371 stores as of 28 June 2026. The company plans to complete most of the closures by the end of fiscal year 2026. Chief operating officer Mike Grams explained the rationalization in a memo distributed to employees on Thursday.

We have identified sites that we do not believe can sustainably provide the experience we want for our customers and our partners, or for which we do not foresee an acceptable financial path forward.

The latest shutdown round will generate approximately $300 million in restructuring charges during fiscal year 2026, covering severance packages, lease cancellations, and asset write-downs. Alongside the closures, Starbucks lowered its forecast for fiscal 2026 global net new store openings to around 440 company-operated and licensed units, down from an earlier projection of 600 to 650. The reduced domestic expansion will be partly offset by higher-than-expected openings in international markets.

Turnaround milestones under Brian Niccol

The store rationalization forms part of the "Back to Starbucks" turnaround strategy led by chief executive Brian Niccol, who completed two years in the leadership role in September 2026 after joining from Chipotle Mexican Grill. Niccol has targeted $2 billion in cumulative cost savings by the end of fiscal year 2028. The initiative prioritizes operational speed, simpler food and beverage menus, and physical renovations over rapid footprint expansion. The company plans to remodel 1,500 stores by the end of the calendar year while keeping net store openings in the United States flat through 2027.

This is the second phase of retail cuts under Niccol. In September 2025, Starbucks eliminated 900 corporate administrative positions and closed hundreds of locations, including its Seattle roastery, in a restructuring effort that cost approximately $1 billion. That round affected several unionized locations represented by Starbucks Workers United, which represents more than 12,000 baristas across nearly 700 US coffeehouses.

Sales momentum and market reception

Despite trimming its physical footprint, Starbucks reported four consecutive quarters of comparable sales growth through July 2026. Customer traffic increased across all income tiers, aided by a refreshed loyalty scheme and menu introductions such as protein cold foam. The company's higher-priced beverages maintained steady demand, withstanding pressure from elevated food and fuel costs that constrained discretionary budgets among lower-income American households.

Market strategists described the operational adjustments as a necessary step in the broader corporate overhaul. Lale Akoner, global market strategist at eToro, assessed the balance between restructuring costs and investor expectations.

This is a sensible but costly step in Starbucks' turnaround.

Following the regulatory announcement, Starbucks shares declined 1.40% during afternoon trading on the New York Stock Exchange. Brian Jacobsen, chief economic strategist at Annex Wealth Management, noted that the executive team must now convert current traffic gains into improved operating profit margins.