Starbucks (SBUX) gained in early traffic as investors looked at the FQ1 results as a sign that a turnaround is taking hold.
Notably, Starbucks (SBUX) plans to open 600 to 650 net new company-owned and licensed cafes during the fiscal year.
During the earnings conference call, Starbucks (SBUX) management pointed out that its brand affinity, visit consideration, and connection scores with customers improved without the chain relying on discounting. “We’re seeing exactly what we want to see in our top line at this point in our turnaround,” updated CFO Cathy Smith.
The general vibe on Wall Street about the Starbucks (SBUX) earnings report was generally positive.
Bank of America noted that the EPS miss was due to tax rate considerations. “We are encouraged by strong transaction growth across regions (+3% in N. America and International, +5% in China), reflecting a combination of better service (Green Apron), innovation (protein), and advertising. Modest ticket growth (+1% globally) speaks to the sustainability of the SSSG compared to the more ticket-driven comp of previous years,” updated analyst Sara Senatore. Crucially, BofA sees the guidance issued by SBUX as conservative and beatable.
Baird was also optimistic about the report. “The FQ1 report was positive in many respects, with SBUX showing better-than-modeled comps momentum and issuing better-than-feared F2026 guidance that may include some conservative underpinnings,” updated Baird analyst David Tarantino.
Seeking Alpha analyst Luca Socci highlighted that Starbucks (SBUX) finally managed to report domestic growth for the first time in two years. “However, this was obtained at the expense of profits, which we clearly see when we read that its operating margin declined by 480 bps. In other words, Starbucks is subject to the volume for profits trade-off,” warned Socci, who said he remains skeptical about the sustainability of its multiple.
Shares of Starbucks (SBUX) were up 4.6% at 10:02 a.m. and crossed over the $100 level for the first time since March of 2025.