- Starbucks will close about 250 North American cafes.
- The closures will cost around $300m.
- International markets will drive new store growth.
Starbucks is closing about 250 cafes across North America as it pushes ahead with its turnaround under CEO Brian Niccol.
The closures represent roughly 1 per cent of the company’s more than 18,000 North American locations and mark the second major round of cafe reductions since Niccol took charge in September 2024.
Starbucks said it had reviewed its North American coffeehouse portfolio and identified locations where it could not consistently deliver the customer experience it wanted or where there was no clear path to acceptable financial performance.
The company expects most of the closures to take place before the end of its 2026 financial year.
The move will come with around $300m in restructuring charges. About $200m will cover costs including early lease exits and employee separation benefits, while the remaining $100m will be non-cash charges linked to the disposal and impairment of store assets.
Starbucks said it will try to transfer baristas from closing cafes where possible and provide severance to employees who leave.
Closing some, investing in others
The latest closures are part of a broader strategy that Starbucks calls “Back to Starbucks”, which aims to rebuild the cafe experience and bring more focus to in-person customer interactions.
The company has been investing in the locations it wants to retain. More than 1,000 coffeehouses across the US and Canada have been redesigned since late 2025, with changes including new seating, artwork, greenery and other features intended to make cafes more welcoming.
Starbucks plans to complete at least 1,500 such coffeehouse “uplifts” by the end of fiscal 2026.
The company has also reported some improvement in its underlying performance. Its third-quarter results showed four consecutive quarters of comparable sales growth and two consecutive quarters of margin expansion.
But the store closures show that the recovery is not simply about opening more cafes.
For fiscal 2026, Starbucks now expects to add 440 net new coffeehouses, down from its previous forecast of between 600 and 650. The new openings are expected to come from international markets.
Starbucks has said it continues to see significant longer-term growth opportunities in North America, suggesting the company is not abandoning the region. Instead, it is becoming more selective about which locations receive further investment.
That distinction is important for Niccol’s turnaround. Starbucks is effectively trying to strengthen its existing network by removing cafes that are not performing as expected, while improving the locations it believes can attract customers and generate better returns.
The company’s previous restructuring plan, approved in September 2025, had already anticipated a much wider transformation. It estimated around $1bn in total restructuring charges, with about 90 per cent linked to its North American business.
Niccol has also cut Starbucks’ corporate workforce. The company eliminated around 2,000 corporate roles in the previous year, along with hundreds of vacant positions, as part of its efforts to reduce costs.
The latest closures therefore add another layer to a turnaround that is trying to balance two competing priorities: making Starbucks cafes better places to visit while making the overall store network more financially efficient.
The question for Starbucks is whether the investment in its remaining cafes can generate enough improvement in customer traffic, sales and profitability to make that smaller North American footprint work.
