Why Is Starbucks (SBUX) Betting on Streamlining Amid Heightened Competition and Slowing Store Growth?

On September 26, Starbucks announced a US$1 billion restructuring plan involving North American store closures and around 900 additional corporate job cuts, projecting a 1% decline in net unit growth for fiscal 2025. This substantial operational shift under CEO Brian Niccol is part of ongoing efforts to refocus resources and improve efficiency amid declining same-store sales and intensified competition. We’ll explore how Starbucks’ accelerated store downsizing shapes the company’s long-term growth outlook and overall investment narrative. We've found 19 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.Starbucks Investment Narrative RecapStarbucks appeals to investors who believe in the company's ability to revitalize growth through operational efficiency and customer engagement, despite recent headwinds such as declining same-store sales and heightened competition. The US$1 billion restructuring and North American store closures announced in late September could impact Starbucks’ most important short-term catalyst, consistent transaction growth, while amplifying the biggest risk: sustained margin pressure from ongoing labor and operational costs. For now, the operational shift is meaningful and may influence near-term revenue and margin forecasts. Among recent announcements, the 1% increase in Starbucks’ quarterly dividend stands out as especially relevant. Even with the ongoing cost-cutting and restructuring, the company extended its record of annual dividend increases to 15 years, which will be closely monitored by investors seeking both yield and potential capital appreciation. The resilience of the dividend, however, now sits alongside near-term uncertainty regarding... In contrast, investors should be mindful that execution risks, especially ongoing margin pressures, could significantly shape Starbucks’ financial picture in the coming quarters. Read the full narrative on Starbucks (it's free!)Starbucks’ outlook forecasts $45.5 billion in revenue and $4.6 billion in earnings by 2028. This projection assumes 7.5% annual revenue growth and a $2.0 billion increase in earnings from the current $2.6 billion.Uncover how Starbucks' forecasts yield a $97.63 fair value, a 24% upside to its current price.Exploring Other PerspectivesSBUX Community Fair Values as at Oct 2025 Simply Wall St Community members shared 22 fair value estimates for Starbucks that span from US$54.97 to US$110 per share. With margin pressures building from restructuring and operational shifts, consider how differently community and analyst perspectives can frame the company's outlook.Explore 22 other fair value estimates on Starbucks - why the stock might be worth as much as 40% more than the current price!Build Your Own Starbucks NarrativeDisagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.A great starting point for your Starbucks research is our analysis highlighting 2 key rewards and 4 important warning signs that could impact your investment decision.Our free Starbucks research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Starbucks' overall financial health at a glance.Curious About Other Options?The market won't wait. These fast-moving stocks are hot now. Grab the list before they run:The latest GPUs need a type of rare earth metal called Dysprosium and there are only 35 companies in the world exploring or producing it. Find the list for free.The end of cancer? These 28 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.The best AI stocks today may lie beyond giants like Nvidia and Microsoft. Find the next big opportunity with these 24 smaller AI-focused companies with strong growth potential through early-stage innovation in machine learning, automation, and data intelligence that could fund your retirement. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.