Starbucks’ fiscal first-quarter results drew attention Thursday as holiday beverage sales and a viral “Bearista” cup helped lift demand, with the company also tying the performance to changes it is making in stores and how customers receive orders. In a statement accompanying the results, the coffee chain said same-store sales rose 4% for the October-December period, higher than Wall Street’s 2.3% expectation, and revenue climbed 6% to $9.9 billion.
On the quarter’s retail performance, Starbucks said same-store sales in the U.S. rose 4%, supported by a 3% increase in transactions and a 1% increase in spending per visit. The company also reported that shares jumped more than 6% before the opening bell Wednesday following the announcement.
Starbucks’ executives pointed to a broader turnaround effort that they said is beginning to show results. Chairman and CEO Brian Niccol told investors on a conference call that “We have a plan, we are working the plan, and the plan is working,” adding, “The shine is back on our brand, both in the U.S. and around the world.” Niccol said the changes over the past year have included adding staff and equipment to stores to improve service and better sequence mobile orders.
Niccol also described efforts to make stores more welcoming, saying about 200 stores have already been redecorated and that more than 1,000 are scheduled to receive that treatment by this fall. He cautioned that the turnaround may not be linear, while still saying the company expects it will turn around lagging sales during the year.
The holiday quarter also included product-driven demand that helped differentiate the period for customers. Starbucks said it delivered record revenue during its holiday launch week, highlighted by the $29.95 glass “Bearista” cups, which it said sold out soon after they were introduced. The company also noted that an “authentic Bearista cup” was listed for $119.99 on eBay on Wednesday.
Starbucks’ traffic gains occurred even as workers took action during one of the company’s busiest seasonal promotions. The company said U.S. traffic rose despite a strike by more than 1,000 unionized Starbucks workers aimed at disrupting Red Cup Day, a day that typically draws heavy volume; Starbucks said the strike closed some stores but only briefly.
The company also said some U.S. stores added customers after it closed nearly 600 stores in North America in September, describing the closures as part of shifting resources toward better performers. In addition to the U.S. results, Starbucks said China same-store sales rose 7% during the quarter.
Looking ahead, Starbucks said it expects global same-store sales and revenue to grow 3% or more in its 2026 fiscal year. It also said its global same-store sales fell 1% in the previous fiscal year. Starbucks said margins were pressured by investments in labor and by tariffs on coffee, though Chief Financial Officer Cathy Smith said some costs should abate as the year progresses.
Starbucks also described new steps for its China strategy. In November, the company announced a joint venture with Chinese investment firm Boyu Capital to operate Starbucks stores in China, under which Boyu would acquire a 60% interest in Starbucks’ retail operations in China valued at $4 billion, while Starbucks would retain 40% and own and license the Starbucks brand.
In terms of profit, Starbucks reported adjusted earnings of 56 cents per share for the quarter, below the 59-cent profit Wall Street expected, after revenue that beat forecasts.