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Starbucks reported a return to sales growth in its US home market in its first quarter, even as heavy spending to add baristas at cafés weighs on profits.
The world’s largest coffee shop chain on Wednesday said that US same-store sales rose by 4 per cent in the three months to December, the first increase in two years and ahead of Wall Street estimates.
The results will be viewed as a positive sign for a turnaround strategy under chief executive Brian Niccol, who has been seeking to improve service, cut down queues and make shops more inviting under a plan he calls Back to Starbucks.
Footfall at US stores rose by 3 per cent in the quarter, a sign that customers are coming back. Starbucks shares were up by more than 9 per cent in pre-market trading.
Niccol suspended financial guidance after he arrived in September 2024. On Wednesday, the company provided a new financial outlook, projecting that global and US comparable sales would increase by 3 per cent or more in the current fiscal year.
Starbucks is spending $500mn this year to add staff, especially during peak hours when delays frustrated some customers.
Labour costs, along with inflationary pressures from high coffee bean prices and US tariffs, cut Starbucks’ profitability, with its operating profit margin dropping by 2.9 percentage points compared to the same quarter a year earlier, to 9 per cent.
The new guidance forecasts that adjusted operating margin for fiscal 2026 will improve slightly from the previous fiscal year.
Starbucks revenue increased by 6 per cent to $9.9bn. Analysts polled by Visible Alpha had expected revenue of $9.7bn.
Net profit fell by 62 per cent to $293.3mn, well below estimates for $668mn.
