Quick Verdict: Starbucks’ Q2 FY 2026 revenue rose 9% to $9.53 billion, handily beating estimates around $9.1 billion, while non‑GAAP EPS of $0.50 beat by $0.06 and GAAP EPS climbed to $0.45. Global comps grew 6.2%, and the company raised FY 2026 guidance, sending the stock up roughly 5% after hours.
About Starbucks Corporation
Starbucks Corporation (Nasdaq: SBUX) is the world’s largest specialty coffee retailer, operating and licensing over 41,000 stores across more than 80 markets, with a brand portfolio that includes Starbucks Coffee, Teavana, and Starbucks Reserve. Founded in 1971 and headquartered in Seattle, Washington, the company’s core business is selling handcrafted beverages, food, and packaged coffee through a mix of company‑operated and licensed cafés, plus a fast‑growing global CPG and ready‑to‑drink business via the Channel Development segment. As of late April 2026, Starbucks carries a market capitalization in the $105–115 billion range, trades around the mid‑20s P/E on forward earnings, and offers a dividend yield near 2.5%, reflecting its profile as a mature but still growing consumer brand. The company ended Q2 FY 2026 with 41,129 stores globally, 52% company‑operated and 48% licensed, including 16,944 in the U.S. and 7,991 in China, which together account for about 61% of the global portfolio.
Top Financial Highlights
- Total net revenues increased 9% year over year to $9.5–9.53 billion, or about 8% on a constant‑currency basis.
- Global comparable store sales rose 6.2%, driven by a 3.8% increase in comparable transactions and a 2.3% increase in average ticket.
- North America comparable store sales were up 7.1% (U.S. also +7.1%), driven by +4.4% transactions and +2.6% ticket.
- International comparable store sales increased 2.6%, with comparable transactions +2.1% and ticket +0.5%; China comps were +0.5%, with traffic +2.1% and ticket –1.6%.
- Starbucks opened 11 net new stores in Q2, ending the period with 41,129 stores globally; net store growth over the last 12 months remains robust, with International company‑operated stores up about 3%.
- GAAP operating margin expanded 180 bps year over year to 8.7%, primarily due to sales leverage and lower store operating and D&A costs following the classification of China retail assets as held for sale.
- Non‑GAAP operating margin improved 120 bps to 9.4%, or 110 bps in constant currency.
- GAAP net income was about $511 million, with GAAP EPS of $0.45, up 32–33% versus $0.34 in the prior‑year period.
- Non‑GAAP EPS rose 22% to $0.50, beating consensus around $0.43–$0.44.
- North America segment net revenues increased 7% to $6.89 billion; operating income fell to $679.9 million with operating margin contracting to 9.9% from 11.6% on higher labor, product mix shift and commodity inflation, partially offset by sales leverage.
- International segment net revenues increased 10% to $2.05 billion; operating income surged to $398.6 million with operating margin expanding to 19.4% from 11.6%, largely due to China assets being held for sale (no D&A) and sales leverage.
- Channel Development net revenues jumped 39% to $567.8 million, driven mainly by the Global Coffee Alliance; operating income increased to $229.9 million, though operating margin fell to 40.5% from 47.3% on mix and JV income dynamics.
- The company completed the China retail transaction (~$3.1 billion), deconsolidating China into a joint venture structure, which improves International margins but changes future revenue and profit mix.
- Management raised FY 2026 guidance to global and U.S. comps of at least 5% (from ~3%) and non‑GAAP EPS of $2.25–$2.45 (up from about $2.15–$2.40), citing improving traffic trends and early benefits from the “Back to Starbucks” plan.
Beat or Miss?
| Metric | Reported Q2 FY 2026 | Difference / Analysis |
| Total net revenues | $9.5–9.53B | Beat vs consensus around $9.09–9.16B, an ~4–5% revenue surprise. |
| GAAP EPS | $0.45 | Up 32–33% YoY; Street focuses on non‑GAAP, but GAAP also ahead of prior year. |
| Non‑GAAP EPS | $0.50 | Beat vs $0.43–$0.44 consensus by about $0.06–$0.07 (~15% upside). |
| Global comparable sales | 6.20% | Beat vs ~+4% expected, with broad‑based strength in North America. |
| North America comps | 7.10% | Stronger than many pre‑earnings models that assumed mid‑single‑digit growth. |
Overall, Starbucks delivered a clean top‑ and bottom‑line beat, with comps ahead of expectations and a guidance raise, even though North America margins compressed due to labor and commodity pressures.
What Leadership Is Saying
Our second quarter marked the turn in our turnaround as our Back to Starbucks plan drove both top and bottom line growth. This is the Starbucks our customers deserve and the Starbucks we believe will deliver long-term growth and value for our partners and shareholders as we execute consistently, at scale.
We’ve been clear that topline improvement would come first, with earnings growth to follow. We have more work to do, but we’re pleased to see the combination of our comp growth and cost discipline starting to show up in margins.
CEO Brian Niccol frames Q2 as an inflection point in the company’s turnaround, pointing to stronger traffic, improved execution in U.S. stores, and progress on the “Back to Starbucks” initiatives (throughput, digital, menu and labor), which management sees as drivers of sustained growth. CFO Cathy Smith emphasizes that the strategy was always to re‑accelerate comps first and then expand profitability, noting that margin improvement is now emerging even as Starbucks continues to invest in workers and operations.
Historical Performance
Starbucks’ Q2 FY 2026 results reflect a clear improvement versus the prior year across revenue, earnings and global comps, even with some margin trade‑offs in North America. International and Channel Development posted particularly strong top‑line and profit growth, helped by portfolio moves and JV structures in China.
| Category | Q2 FY 2026 | Q2 FY 2025 | Change (%) / Comment |
| Revenue | $9.5–9.53B | ≈$8.76–8.76B (implied +8.8%) | ≈+8.8–9% revenue growth |
| Net income (GAAP) | $510.9M | $384.2M | ≈+33% – first profit increase in over two years |
| Operating expenses (proxy: GAAP operating margin) | 8.7% margin | ≈7.0–7.1% margin (180 bps lower) | Margin expansion on leverage & China asset reclass |
Global comps of +6.2% represent a notable acceleration from the prior‑year quarter, which saw low‑single‑digit growth, and they are broad‑based across dayparts, beverages and food in the U.S. While North America segment margin contracted due to higher labor and cost inflation, overall company margins improved as International and Channel Development margins expanded sharply and as depreciation stopped on China assets held for sale.
Historical Performance – Competitor YoY
A relevant quick‑service peer is McDonald’s Corporation (MCD), which reported Q1 2026 results a day earlier; while not perfectly aligned in calendar or format, the comparison highlights consumer‑demand and pricing dynamics across global QSR.
| Category | McDonald’s Q1 2026 | McDonald’s Q1 2025 | Change (%) / Comment |
| Revenue | ≈$6.4B (implied) | ≈$5.9B (implied) | mid‑single‑digit to high‑single‑digit growth |
| Net income | ≈$1.8B (implied) | ≈$1.6B (implied) | double‑digit EPS growth |
McDonald’s also posted solid revenue and EPS growth with positive comps and continued price realization, but Starbucks’ 6.2% global comps and 22% EPS growth put it near the top of large‑cap global QSR in terms of momentum this quarter, albeit with lower structural margins and higher sensitivity to commodity and labor costs.
How the Market Reacted
The market response to Starbucks’ Q2 FY 2026 report was positive: shares rose roughly 5% in after‑hours trading as investors digested the revenue and EPS beats and the upgraded full‑year guidance. Commentary from CNBC, MarketBeat and other outlets highlighted that global comps and U.S. traffic trends were stronger than expected, and that the “Back to Starbucks” operational initiatives are beginning to translate into both sales and margin gains. Some analysts noted ongoing concerns around North America margin compression and China’s slower‑than‑hoped recovery, but consensus sentiment framed the quarter as a clear step forward in the turnaround, with the raised EPS range reinforcing confidence in mid‑term earnings power.