Starbucks store closures: Why is the coffee giant shutting 250 North American locations despite rising sales and earnings forecasts?

Starbucks will close about 250 coffeehouses across North America later this week. The move is the second major round of store closures since Brian Niccol became CEO in 2024, and it comes as the company tries to improve the performance of its existing locations.

The company has not identified the stores that will close. It has also not said how many are in the U.S. or how many have unionized workers. That leaves employees and customers without a store-by-store picture for now.

Why Starbucks is closing these particular stores

Chief Operating Officer Mike Grams said Starbucks reviewed its North American coffeehouse portfolio before deciding which locations should close.


His explanation was fairly direct. Some stores are not producing acceptable financial results. Others cannot consistently deliver the experience Starbucks wants for customers and employees.

Grams said the company remains committed to growing its North American store count. The focus is on which locations can support that growth.

Starbucks already closed 627 stores in North America and Europe last September. It also eliminated 900 non-retail jobs as part of that restructuring.

The latest round is smaller, with about 250 North American coffeehouses affected. Starbucks said the new closures will lead to roughly $300 million in restructuring expenses.

The company has also continued cutting corporate positions. In May, Starbucks laid off another 300 corporate employees and closed some underused U.S. offices.

Why Starbucks has been remodeling its coffeehouses

Starbucks has been retrofitting its North American coffeehouses to make them more comfortable and inviting. The company expects 1,500 stores to have been retrofitted by September 30, the end of its fiscal year.

Grams said those changes have also given Starbucks a clearer view of how individual coffeehouses are performing. Most are benefiting from the changes, he said. Some are still struggling despite the work put into them.

What will happen to Starbucks employees?

Starbucks says employees at closing locations will be transferred to other stores when possible. If another position cannot be found, the company says it will provide severance support.

Starbucks has not disclosed whether the affected stores include unionized locations. More than 700 U.S. Starbucks stores have voted to unionize since late 2021, while the company and the union have yet to reach a labor agreement.

The closures are taking place at a time when Starbucks is expecting stronger financial performance. After its July quarterly results, the company raised its fiscal 2026 outlook. It now expects adjusted earnings per share of $2.55 to $2.65, up from its earlier forecast of $2.25 to $2.45.

Starbucks also expects global same-store sales to grow by nearly 6%. U.S. same-store sales are expected to rise by more than 6%.