Starbucks is set to close around 250 underperforming coffeehouses across North America as chief executive Brian Niccol steps up efforts to reshape the coffee giant’s business and improve its financial performance. The closures, announced in a regulatory filing, are part of the company’s broader “Back to Starbucks” strategy, which aims to strengthen existing stores, improve customer service and focus investment on locations with better long-term potential.
The planned shutdowns account for roughly 1% of Starbucks’ more than 18,000 coffeehouses across North America. The company has said it identified locations where it could not consistently provide the customer and employee experience it wanted or where there was no clear path to acceptable financial performance. Starbucks expects the closures to result in about $300 million in restructuring charges, meaning the move will impose a significant short-term financial cost as the company attempts to improve its operations over the longer term.
The decision comes as Starbucks continues a restructuring programme that began after Niccol took over as CEO. Niccol, who previously headed Chipotle Mexican Grill, has been attempting to reverse a period of weaker sales and declining customer traffic at the coffee chain. His turnaround plan has focused on returning Starbucks to what the company describes as its core strengths — coffee, customer service and welcoming coffeehouses.
Rather than continuing to rapidly increase its store network, Starbucks is now putting greater emphasis on improving the performance of its existing locations. The company has lowered its target for new stores in fiscal 2026, with about 440 net new company-operated and licensed coffeehouses expected globally. The earlier target had been between 600 and 650 new locations. The change reflects a greater focus on strengthening the existing network while continuing selective expansion.
Improving the experience inside Starbucks stores has been a central part of Niccol’s strategy. The company has been working to reduce customer waiting times, simplify its menu and increase staffing during busy periods. Starbucks has also been redesigning its coffeehouses, with changes including softer seating, artwork, greenery and other local design elements intended to create a more comfortable environment.
The company said it had completed improvements at more than 1,000 coffeehouses across the United States and Canada since late 2025 and plans to reach at least 1,500 upgraded locations by the end of fiscal 2026. Starbucks has described these changes as part of its effort to strengthen the role of its coffeehouses as places where customers can stay, meet and connect.
The latest closures follow a similar restructuring exercise carried out roughly a year earlier. Starbucks previously shut a number of underperforming North American locations, including its well-known Seattle Roastery, as part of a restructuring programme estimated to cost the company about $1 billion. The company has also reduced corporate costs and eliminated non-retail positions as part of its wider effort to simplify its operations.
Despite the closures and cost reductions, Starbucks has reported signs of improvement in its sales performance. By July 2026, the company had recorded four consecutive quarters of comparable-sales growth, a measure that tracks performance at existing stores and therefore provides an indication of underlying customer demand.
Starbucks has also raised its annual sales and profit forecasts twice in 2026, according to Reuters. The company has attributed part of the improvement to faster service and additional staffing, with Niccol saying customer traffic had increased across income groups.
However, the company continues to face pressure from consumers who are cautious about discretionary spending. Starbucks products are generally considered non-essential purchases, making the business sensitive to changes in household budgets and broader economic conditions. The company is therefore attempting to increase customer visits while simultaneously controlling expenses and improving profit margins.
The 250 closures represent another stage in that balancing act. Starbucks says the decision was based on individual store performance and the ability of locations to deliver the experience and financial results expected by the company. It has said affected employees will be supported through the transition, including opportunities to transfer to other coffeehouses where possible and severance support for those who cannot be placed elsewhere.
The company is also continuing to invest in locations that it believes have stronger prospects. Starbucks has said North America remains an important long-term growth market and that it continues to develop a pipeline of new coffeehouses even as it removes stores that are not meeting its expectations.
The latest restructuring therefore represents more than a simple reduction in the number of Starbucks outlets. It is part of Niccol’s broader attempt to change how the company allocates money, employees and other resources. Starbucks is simultaneously closing weaker locations, slowing the pace of expansion, redesigning stores, increasing staffing in busy periods, simplifying operations and reducing corporate expenses.
The key challenge for the company will be whether the improvement in customer traffic and comparable sales can be sustained and converted into stronger profitability. While the early sales trends have provided evidence of improving demand, the restructuring costs and continued pressure on margins mean Starbucks still has significant work ahead as it moves through fiscal 2026.
