Starbucks announced significant changes to its operations on Thursday, including the closure of several underperforming coffeehouses and the elimination of approximately 900 corporate, non-retail jobs.
The moves are part of the company’s ongoing “Back to Starbucks” turnaround strategy aimed at strengthening its core business and improving customer experience.
According to CEO Brian Niccol, the coffee chain is reducing its North American footprint slightly, with a net decline of about 1% in company-operated stores during fiscal year 2025. The closures follow a review of locations where Starbucks said it could not meet customer expectations or maintain financial viability.
The company emphasized that many of the affected stores are unable to support the kind of physical environment the brand wants to offer.
Employees at the impacted stores will be notified this week, and Starbucks said it will try to transfer them to nearby locations and those who cannot be placed will receive severance packages, with the company expressing interest in rehiring them as new stores open in the future.
Despite the closures, Starbucks said it plans to invest in over 1,000 existing locations over the next 12 months, introducing updates to store design and layout aimed at improving atmosphere and customer engagement.
In addition to store closures, Starbucks is cutting about 900 jobs from its non-retail workforce. These reductions include current roles and the closure of many open positions. Affected employees will be notified Friday and will receive severance and benefits extensions. The company has instructed corporate staff to work remotely during the transition.
The changes come as Starbucks continues to focus on increasing in-store staffing during peak hours, enhancing service speed, and updating store aesthetics—all part of a broader effort to boost performance and customer satisfaction.
Starbucks ended its last fiscal year with nearly 18,300 locations across the U.S. and Canada. While 2025 will see a slight dip in store count, the company said it expects to expand again in 2026.