Starbucks to Close About 250 North American Stores as Part of Restructuring
Starbucks will shut roughly 250 U.S. and Canadian cafés, representing about 1% of its North American footprint, incurring $300 million in related costs while it pursues a broader turnaround plan.
Starbucks announced it will close approximately 250 locations in the United States and Canada over the next few days, representing roughly one percent of its roughly 18,000-store North American base. The company said the cafés were either not delivering the desired customer experience or were not financially viable. The closures will be signaled on storefronts this weekend and reflected in the company’s mobile app.
The chain expects to record about $300 million in charges tied to the shutdowns, including $200 million for early lease terminations and employee severance, according to a regulatory filing. The move follows a similar round of store closures and corporate layoffs announced a year earlier as part of a $1 billion restructuring effort led by CEO Brian Niccol, who is overseeing a multi-year plan to revamp the business.
In North America, the plan includes café renovations, service improvements and a simplified menu. While Starbucks forecasts opening around 440 new stores worldwide this fiscal year—down from a prior target of 600-650—it highlighted that same-store sales at U.S. locations rose 7.9% in the latest quarter, a growth momentum the company said it could now measure.
"We remain excited about the significant long-term growth opportunity ahead in North America," COO Mike Grams wrote in a letter to employees, adding that the firm is developing a pipeline of new coffeehouses and remains committed to growth.