Starbucks CEO Brian Niccol Talks Potential For Multi-Brand Model

Niccol declares Starbucks turnaround done, eyes growth before acquisitions

Brian Niccol argues the Starbucks turnaround is finished and the company is already running ahead of the targets it set for fiscal 2027 and 2028. Growth now rests on more visits to existing stores and new units at home and abroad, funded partly through capital-light partnerships. That organic runway is why a multi-brand portfolio or acquisitions remain possibilities he studies but does not need.

Takeaways

• Turnaround is over, growth phase begins. Niccol says Starbucks has moved past its turnaround to a growth plan for fiscal 2027 and beyond. Transactions and the Green Apron service model lead it, backed by menu innovation and marketing. Bostick notes transaction growth stepped down while ticket growth accelerated.
• Starbucks is running ahead of guidance. Niccol expects growth of at least 4% this year versus earlier guidance of 3% or better. Margins have expanded to a range of 13.5% to 14%, and the company was touching the low end of its fiscal 2028 guidance a year early.
• Multi-brand and deals are optional, not urgent. Niccol says Starbucks' scale could support a portfolio of other businesses leveraging its strength, but that is not the focus now and talks with other parties were not this year's priority. It needs no inorganic growth to hit targets, though he still evaluates acquisitions.
• Guidance is a waypoint toward 17% margins. Pressed on whether investors should anchor to the low or high end of fiscal 2028 targets, Niccol called the guidance a point in time within a longer growth journey. The long-run aim is to get back to margins of 17% or better.
• US estate was cleaned up before regrowth. After roughly 250 North American store closures, Niccol says Starbucks changed its US strategy on what to build and where, then reset its pipeline. It plans roughly 300 new stores in fiscal 2028, alongside growing customers within existing stores.
• International expansion goes capital light. Starbucks sold 60% of its international business in a capital-light partnership, and Niccol calls the China venture with Boyu Capital off to a terrific start. Bostick flagged soft international sales, but revenue grew 5% excluding China. Niccol sees 22,000 non-US stores doubling to 40,000 plus.
• Cold drinks are driving the menu. Espresso was the biggest growth category last year, mainly through cold drinks. Matcha, which Kathy Smith called a billion-dollar business, is led by iced matcha lattes built on the Cold Foam platform. Niccol's own pick is one with strawberry cold foam.