Starbucks suspends FY guidance as Q4 revenues fall 3% to $9.1bn

Starbucks has decided to suspend its financial guidance for 2025, as consolidated net revenues dipped 3% to $9.1bn (£7bn) during the fourth quarter due to global sales falling 7% during the period.

In light of the group’s recent performance, newly-appointed CEO Brian Niccol has said “it’s clear we need to fundamentally change our recent strategy”. 

The group’s Q4 performance was primarily driven by softness in North America’s revenues, specifically a 6% decline in US comparable store sales and 10% decline in comparable transactions. 

While this was partially offset by a 4% increase in average prices, Starbucks’ accelerated investments in an expanded product range and more frequent in-app promotions did not improve customer behaviour – resulting in a “lower-than-expected” performance.  

As for the full year to 29 September, global store sales fell 2% and consolidated net revenues inched down 1% to $36.2bn (£27.8bn), which was also attributed to a decline in store footfall and a cautious consumer environment.

By suspending its financial guidance, the group believes this will “allow ample opportunity to complete an assessment of the business and solidify key strategies, while stabilising and positioning the business for long-term growth”.

Rachel Ruggeri, CFO of Starbucks, said: “Despite our heightened investments, we were unable to change the trajectory of our traffic decline, resulting in pressures in both our top-line and bottom-line. While our efficiency efforts continued to produce according to plan, they were not enough to outpace the impact of the decline in traffic. 

“We are developing a plan to turn around our business, but it will take time. We want to amplify our confidence in the business, and provide some certainty as we drive our turnaround. For that reason, we have increased our dividend.”

Niccol added: “I’ve spent my first several weeks in stores engaging with and listening to feedback from our partners and customers. It’s clear that Starbucks is a much-loved brand. We need to focus on what has always set us apart — a welcoming coffeehouse where people gather and where we serve the finest coffee, handcrafted by our skilled baristas. 

“We are energised and the team is already moving quickly. I’ll share more details at our upcoming earnings call, but invite you to listen to my initial thoughts on our investor relations website.”