Starbucks CEO Brian Niccol announced Thursday that the company will shut underperforming U.S. stores, cut 900 corporate roles, and freeze many open positions as part of its turnaround plan.
In a letter to employees, Niccol said Starbucks found locations “unable to create the physical environment our customers and partners expect” or lacking a “path to financial performance.” While the company regularly opens and closes stores, he noted, “this is a more significant action” that affects more employees and customers.
Niccol did not specify how many stores will close, but said employees will be notified this week, with job cuts to be announced on Friday. He noted that new openings under his “Back to Starbucks” strategy will offset most closures, leaving the North American store count down only about 1% in fiscal 2025.
By year’s end, Starbucks will have nearly 18,300 company-operated and licensed locations across North America. In 2026, it plans to expand further, with over 1,000 stores receiving a new interior design. Niccol, a year into the role, said the turnaround is “ahead of schedule” but stressed the need for tighter cost control and focus on long-term growth drivers.
“These steps are to reinforce what we see is working and prioritize our resources against them,” Niccol said.
A year ago, Niccol became Starbucks’ third CEO in two years, taking over amid union pressures and declining traffic. Entering his second year, demand remains soft as consumers spend more cautiously. His turnaround plan centers on refreshed interiors to encourage longer visits, personal touches like mugs and handwritten names, better staffing, streamlined mobile orders, self-serve condiments, and a goal of delivering drinks within four minutes. Niccol claimed early store redesigns have boosted visits, customer feedback, and time spent in cafés, while improved staffing has already increased sales, transactions, and reduced wait times.
BREAKING: Starbucks to close undisclosed number of underperforming stores, cut jobs as part of turnaround plan pic.twitter.com/NZY3uQGrgi
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