Starbucks to Close About 250 North American Cafes, Expects $300 Million Restructuring Charge

Starbucks announced Thursday that it will close roughly 250 underperforming cafes across North America, a move the company tied to its ongoing turnaround under CEO Brian Niccol and one that carries an estimated $300 million restructuring charge, according to CNBC.

What Starbucks Announced

The closures affect about 1% of the more than 18,000 Starbucks locations in North America, CNBC and USA Today reported. Chief Operating Officer Mike Grams told employees in a letter that the company had "carefully reviewed" its North America coffeehouse portfolio and identified locations where it could not "consistently deliver the experience we want for customers and partners" or where there was no clear "path to acceptable financial performance," according to CNBC and the Jamaica Observer.

According to a regulatory filing cited by CNBC, most of the closures will occur before the end of Starbucks' fiscal 2026, which ends later this month. Grams' letter, as reported by USA Today, said the affected stores would close "later this week." Starbucks did not provide a list of the roughly 250 locations closing, and it was not immediately clear where those cafes are located, per CNBC and USA Today.

Employees at the closing stores will be offered transfer opportunities to other locations, and those unable to transfer will receive severance support, Grams said in his letter, according to USA Today. The company did not provide details on the severance package.

The Cost: A $300 Million Restructuring Charge

Starbucks expects to incur approximately $300 million in restructuring charges tied to the closures, CNBC reported, citing the company's disclosures. Of that total, about $200 million relates to the cost of exiting leases early and paying employee separation benefits, while the remaining $100 million represents noncash charges from the disposal and impairment of company-owned restaurant assets, according to CNBC.

Despite the store cuts in North America, Starbucks said in its regulatory filing that it "continues to see significant longer-term growth opportunity ahead in North America and is actively developing a strong pipeline of new coffeehouses," CNBC reported.

Lower Growth Outlook for Fiscal 2026

The closures come alongside a reduction in Starbucks' global expansion plans. The company now projects net new store openings of 440 for fiscal 2026, down from its prior outlook of 600 to 650 locations, according to CNBC and the Jamaica Observer, which cited the same securities filing. Starbucks said the new cafes contributing to that lowered figure will come from its international markets rather than North America, per CNBC. The Jamaica Observer noted Starbucks operates 41,000 stores globally.

Our calculation: using the figures reported by CNBC, the revised target of 440 net new cafes is 160 fewer than the low end of the prior 600-to-650 range (600 − 440 = 160) and 210 fewer than the high end (650 − 440 = 210) — a reduction of roughly 27% (160 ÷ 600 = 26.7%) to 32% (210 ÷ 650 = 32.3%) versus the prior guidance range. This is straightforward subtraction and division from the reported figures, not an official company characterization.

Second Round of Cuts Under Niccol's Turnaround

Thursday's announcement marks the second round of North American store closures during Niccol's roughly two-year tenure as CEO, according to CNBC. A year earlier, Starbucks eliminated hundreds of North American stores and announced that 900 administrative jobs would be eliminated, the Jamaica Observer reported. Niccol joined Starbucks as CEO in September 2024 after leading Chipotle and introduced the "Back to Starbucks" strategy that same year, which reinstated free in-store refills, brought back the condiment bar, updated the company's code of conduct, and simplified the menu, per USA Today and the Jamaica Observer.

In his letter to employees, Grams framed the latest closures against that broader strategy, saying that while most locations are "thriving" as they integrate Back to Starbucks initiatives, some stores are underperforming "despite the hard work and commitment of all of you," USA Today reported. Grams added: "We're making this decision for a simple reason: We want every Starbucks coffeehouse to be a place customers love and partners are proud to work."

Market Reaction

Starbucks shares were down 1.2% in early afternoon trading Thursday, according to the Jamaica Observer. No additional details on sell-side estimate revisions or management commentary on comparable-sales or margin impact from the closures were reported in the available coverage.

Bottom Line

Starbucks is trimming its North American footprint for the second time under Niccol's leadership, pairing roughly 250 store closures with a $300 million restructuring charge and a scaled-back global unit-growth target for fiscal 2026. The company frames the move as portfolio discipline within its Back to Starbucks turnaround rather than a retreat from North America, where it says it still sees long-term growth potential. Investors registered a modest, single-day share decline on the news, though the reported evidence does not indicate how analysts have adjusted estimates or whether management addressed near-term margin or comparable-sales effects beyond the restructuring figures disclosed.