Starbucks Corp. has announced a sweeping $1 billion restructuring plan that will see the closure of hundreds of stores and the elimination of 900 jobs across the United States and Canada. The move comes as part of a turnaround strategy under Chief Executive Officer Brian Niccol, who has been at the helm for a year and is working to revive the brand after six consecutive quarters of declining same-store sales.
By the end of the fiscal year, the coffee chain&rsquo;s total store count in North America will shrink by about 1%, leaving it with roughly 18,300 outlets. While this contraction marks a short-term setback, Starbucks plans to resume growth afterward by opening new stores and refurbishing nearly 1,000 existing locations.
Niccol explained that a comprehensive review identified underperforming outlets that failed to create the welcoming atmosphere customers expect or lacked a clear path to profitability. &ldquo;Early results from coffeehouse uplifts show customers visiting more often, staying longer, and sharing positive feedback,&rdquo; he wrote in a letter to employees.
The restructuring will not only reduce costs but also streamline operations. Starbucks is simplifying its menu to cut down on wait times and make room for healthier, innovative options including sugar-free and protein-infused beverages. The company also plans to redesign its coffeehouses by adding more seating and electrical outlets, making them more inviting for longer stays.
Despite these ambitions, analysts remain cautious about the heavy costs and lengthy timeline of Niccol&rsquo;s plan. Profitability has taken a hit as investments in revamping stores mount, while demand for pricey beverages has softened in the US market. The company is also grappling with challenges in China, where increased competition and subdued demand have prompted it to consider selling part of its stake.
Around 900 employees across shuttered stores will lose their jobs in this phase of restructuring, following another 1,000 layoffs announced earlier this year. Starbucks has promised &ldquo;generous severance and support packages&rdquo; to those affected, though many open roles will also be cut.
The coffee giant&rsquo;s shares have slipped nearly 8% this year, reflecting investor unease. For Niccol, the task ahead is clear: revitalize the Starbucks experience while balancing costs and keeping pace with changing consumer preferences.

Starbucks shuts stores, cuts 900 jobs in revamp

Coffee giant launches $1B overhaul, closing outlets and laying off staff in US, Canada

Starbucks shuts stores, cuts $1 billion in revamp

Coffee giant launches $1B overhaul, closing outlets and laying off staff in US, Canada

September 25, 2025 | 19:17 IST