Starbucks closes 250 stores in North America

Starbucks announced on Thursday that it will close approximately 250 coffeehouses across North America, representing about 1% of its more than 18,000 locations in the region.

The move targets stores that fail to deliver the desired customer and partner experience or lack a clear path to acceptable financial performance, according to a company regulatory filing and an internal letter.

The closures form part of CEO Brian Niccol’s ongoing “Back to Starbucks” turnaround strategy.

Niccol, who marked two years in the role this month after joining from Chipotle, has focused on shorter wait times, simpler menus, store renovations, and improved service standards.

The company noted that North America has returned to strong growth, with customers receiving faster service and warmer environments, while it accelerates toward completing 1,500 coffeehouse uplifts.

“We have carefully reviewed our North America coffeehouse portfolio and identified locations where we do not believe we can consistently deliver the experience we want for customers and partners or where we don’t see a path to acceptable financial performance,” Chief Operating Officer Mike Grams wrote in a letter to employees.

“As a result, we will close approximately 250 coffeehouses later this week.”

Most closures are expected to occur by the end of fiscal 2026, which concludes later this month.

Starbucks anticipates about $300 million in related restructuring charges—roughly $200 million in cash costs for exiting leases and employee separation benefits, plus $100 million in non-cash charges for asset disposal and impairment.

The company revised its outlook for global net new store openings downward to about 440 for the fiscal year, from a prior target of 600 to 650.

Grams voiced support for affected staff, known as partners. “We’re speaking directly with impacted partners and will support them through this transition, including transfer opportunities wherever possible. For partners we are unable to place in another coffeehouse, we will provide severance support,” he said. 

He also thanked those at the closing locations and noted the company would direct customers to nearby stores.

This latest round follows a larger restructuring a year earlier that included hundreds of store closures and significant job cuts at an estimated cost of about $1 billion.

Analysts described the new step as pragmatic amid improving sales.

“This is a sensible but costly step in Starbucks’ turnaround,” said Lale Akoner, global market strategist at eToro, while cautioning that sustained sales and margin gains remain essential.

Despite the cuts, Starbucks reaffirmed its commitment to North American expansion.

“We remain excited about the significant long-term growth opportunity ahead in North America. We are actively developing a strong pipeline of new coffeehouses and remain committed to growth in North America,” Grams wrote.