Starbucks CEO Says ‘Thousands’ More Store Upgrades Coming, Bets On China Growth

• Niccol also sees significant growth potential in China following Starbucks’ partnership with Boyu Capital.
• He said Boyu believes Starbucks’ China business could eventually grow from more than 8,000 coffeehouses today to between 15,000 and 20,000 locations.
• Starbucks is also targeting afternoon growth through its Refreshers platform and plans to expand health-and-wellness offerings, including protein products.

Starbucks Corp. (SBUX) CEO Brian Niccol said the coffee chain plans to upgrade thousands more stores next fiscal year, implying that its multiyear “Back to Starbucks” turnaround remains in investment mode.

“I would categorize it as: the shine is back on Starbucks, and the experience is back in our coffeehouses,” Niccol said in a CNBC interview.

Starbucks previously said it expected more than 1,000 coffeehouse “uplifts” in fiscal 2026 and has talked about adding more than 25,000 seats. According to Niccol, the company plans to upgrade roughly 1,500 stores by the end of the current fiscal year, followed by thousands more in the next fiscal year.

“We’re probably about 9 months in. We’ve touched well over 1,000. By the time we get to the end of our fiscal year, we’ll probably close in on 1,500 or more, and then we’ll do thousands more in our next fiscal year.”

– Brian Niccol, CEO, Starbucks

SBUX stock edged 0.4% lower amid broader market weakness. On Stocktwits, retail sentiment around the shares flipped to ‘bullish’ from ‘bearish’ territory over the past day. 

Starbucks Sees China Growth Opportunity After Boyu Deal

Niccol also struck an upbeat tone on Starbucks’ China business following the company’s deal with Boyu Capital. Under the agreement announced in April, Boyu took a 60% stake in Starbucks’ China business, while Starbucks retained 40%.

“We have a shared vision that we think we can grow that China business in a material way,” Niccol said. Starbucks currently has more than 8,000 coffeehouses in China, and Niccol said its partner believes the business can eventually reach 15,000 to 20,000 locations.

“It’s also becoming a place where people want to have a community experience in a Starbucks,” he said. “I think that is going to continue to be how we push forward in China.”

The China opportunity provides Starbucks with another potential growth driver as the company works to improve its core U.S. business.

Store Upgrades Remain Central To ‘Back To Starbucks’

The store upgrades are a central part of Niccol’s “Back to Starbucks” strategy, which he launched after taking over as CEO in September 2024. The initiative has focused on restoring Starbucks’ coffeehouses, improving service and simplifying operations after a period of weaker traffic and customer complaints.

Niccol said the physical changes were intended to restore the atmosphere that helped distinguish Starbucks from competitors. The next priority, he said, is ensuring stores have adequate staffing and that employees are deployed effectively. 

“We want to make sure that our partners have the right rosters, our partners are deployed correctly, and our partners are given the support they need,” Niccol stated.

Starbucks Targets Afternoon Growth With Refreshers

Starbucks is also looking beyond its traditional morning coffee business for growth. Niccol said the company plans to push its Refreshers beverage platform further into the afternoon while continuing to expand its health-and-wellness offerings, with protein products serving as an early example.

“Protein was really the first thing to help us elevate our health and wellness platform, which you’ll continue to see us pushing forward,” he said. “You’ll see us push into the PM day part using our refreshers platform.”

Niccol stated that the broader strategy is to simplify products that no longer resonate with customers while introducing drinks and food that better match current preferences.

“We’re right on track as it relates to the menu innovation,” he said. “We’re bringing in the products and experiences that now are relevant for how customers want to drink and eat today.”

SBUX stock has gained around 19% year-to-date. The average 12-month price target for the shares stands at roughly $112, according to Koyfin data, suggesting more than 12% upside from current levels. Nearly half of the analysts covering the stock rate it a ‘Hold,’ according to the data.

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