Starbucks Q3 Smashes Estimates: 7.9% Comp Growth, Raised Guidance, China Deal Closed
SBUX sits 40% above its 52-week low of $77.99.
Summary
Starbucks reported blowout Q3 FY2026 results: 7.9% global comparable store sales growth, raised full-year guidance, and closed the China divestiture. The turnaround is working.
Key Events · Earnings and Guidance · SBUX
-
Q3 Results Crush Expectations
Revenue of $9.32B beat the $9.16B consensus; adjusted EPS of $0.85 vs. $0.78 estimate. Global comparable store sales rose 7.9%, with U.S. comps up 8.1% on 4.5% transaction growth.
-
Full-Year Guidance Raised
Management lifted its fiscal 2026 outlook, citing sustained momentum from 'Back to Starbucks' initiatives and easing cost pressures.
-
China Divestiture Closed, $536M Gain
The sale of a 60% stake in China retail operations to Boyu Capital closed March 30, generating a $536.3M pre-tax gain. 7,991 stores converted to licensed, shifting the model to higher-margin royalties.
-
$1.3B Debt Repurchase
Proceeds from the China deal were used to repurchase $1.3B of senior notes, reducing long-term debt and interest expense.
Analysis · SBUX · Trade & Services
Starbucks delivered a standout quarter that changes the narrative. Global comparable store sales jumped 7.9%, driven by a 4.2% increase in transactions and 3.5% higher average ticket in the U.S. — evidence the 'Back to Starbucks' turnaround is gaining real traction. Revenue of $9.32 billion beat the $9.16 billion consensus, and adjusted EPS of $0.85 crushed the $0.78 estimate. Management raised full-year guidance, signaling confidence the momentum will continue. The China divestiture closed, generating a $536 million pre-tax gain and converting 7,991 stores to a licensed model, which should structurally lift margins. The company used $1.3 billion of the proceeds to retire debt, strengthening the balance sheet. Restructuring charges of $303 million this quarter reflect the cost of streamlining, but the underlying operating margin expanded 60 basis points to 10.5%. With the stock near a 52-week high, these results validate the premium multiple and suggest the recovery has further to run.
At the time of this filing, SBUX was trading at $109.50 on NASDAQ in the Trade & Services sector, with a market capitalization of approximately $118.7B. The 52-week trading range was $77.99 to $109.23. This filing was assessed with positive market sentiment and an importance score of 9 out of 10.