Starbucks is closing approximately 250 underperforming stores across the U.S. this week, marking the second major wave of closures under Chief Executive Officer Brian Niccol. The move, announced by Chief Operating Officer Mike Grams in a letter to employees reported by Reuters and the Associated Press, involves roughly 1% of the company’s 18,000 stores in the U.S.
Financial Performance and Store Selection Criteria
According to the company’s public statement and memo to workers, the targeted locations either failed to deliver adequate financial results or could not maintain the customer and partner experience standard required by leadership. Company executives stated that while the vast majority of the coffeehouse portfolio remains profitable, a small segment lacks a clear path to acceptable financial performance. Starbucks disclosed that the closures will generate approximately $300 million in restructuring charges.
The coffee giant plans to complete the bulk of these closures by the end of 2026. This follows a larger contraction in September 2025, when Starbucks shuttered 627 stores across the United States and Europe.
Employee Impact and Relocation Plans
Starbucks management indicated that workers at the affected stores will be offered relocation to other store locations where possible. For employees who cannot be reassigned, the company stated it will provide severance assistance. Neither the exact store addresses nor the precise count of unionized locations slated for closure were publicly disclosed by the company.
More than 700 U.S. Starbucks locations have voted to unionize since 2021, though the labor union and the corporation have not yet reached a comprehensive collective bargaining agreement.
Corporate Restructuring and Legal Settlements
In addition to retail footprint reductions, Starbucks has cut jobs within its corporate division. The company laid off 900 nonretail employees during the September 2025 store closures and eliminated another 300 corporate positions while closing underused U.S. offices in May 2026, according to the Associated Press.
Last week, Starbucks resolved a lawsuit brought by Florida Attorney General James Uthmeier’s office by agreeing to pay $1 million to the Florida Department of Legal Affairs. Under the statewide settlement, Starbucks committed to discontinuing race- and sex-based goals, preferences, and quotas in hiring, promotions, pay, executive compensation, and board composition.
Related reading