Starbucks (SBUX) Q1 2025 earnings summary

Executive summary

• Q1 FY25 revenue was $9.4 billion, flat year-over-year, as new store openings offset a 4% global comparable store sales decline and the company executed its 'Back to Starbucks' turnaround strategy.

• EPS was $0.69, down 23% year-over-year, reflecting increased investments in wages, benefits, and operational changes.

• Operating margin contracted to 11.9%, down 380–390 basis points, mainly due to deleverage and labor investments.

• Store count grew to over 40,500, with 377–1,347 net new stores opened globally in Q1.

• Early signs of turnaround include improved sales mix, increased non-Rewards customer traffic, and sequential comp improvement.

Financial highlights

• Q1 consolidated revenue was $9.4 billion, flat year-over-year, with 7% net new company-operated store growth offset by a 4% decline in comparable store sales.

• Operating margin was 11.9%, down 380–390 basis points year-over-year, due to deleverage and labor investments.

• EPS was $0.69, down 22–23% year-over-year.

• Net earnings attributable to Starbucks were $780.8 million, down from $1,024.4 million year-over-year.

• Net cash provided by operating activities was $2.1 billion, down from $2.4 billion year-over-year.

Outlook and guidance

• Full-year guidance remains suspended; EPS is expected to be lowest in Q2 due to seasonality, restructuring, and investments, with improvement anticipated in the second half of FY25.

• Management remains focused on executing the turnaround strategy and delivering predictable capital returns via dividends.

• Sufficient liquidity is expected for at least the next 12 months, with $4.2 billion in cash and investments and $3.0 billion in available credit.