How Starbucks makes money

Starbucks had 40,990 stores at the end of fiscal 2025. It ran 21,514 itself: every latte sold there is its revenue, and the baristas, rent and milk are its costs.

Almost half, 19,476, were licensed: another company runs the store under the Starbucks name, in places like airports, campuses and grocery stores. Starbucks doesn't count that store's sales, only what the licensee pays it: the coffee, cups and machines it buys from Starbucks, plus a royalty. The licensee pays the store's running costs.

The rest is coffee in bags and pods, sold in supermarkets through Nestlé, and bottled drinks made with partners like PepsiCo. In 2018 Nestlé paid Starbucks about $7B up front for that right, and Starbucks counts it a little at a time over 40 years: $176.5M in fiscal 2025.

Many customers put money on a Starbucks Card or the app and spend it later. In fiscal 2025 they loaded $15.2B, counting the Stars members earned: equal to about 41% of Starbucks' revenue.

That money arrives before the coffee is made. Until it's spent, Starbucks owes the customer the drinks, so its books count the balance as a debt, not a sale. At the end of the year, $1.8B was still sitting on cards and in the app. Starbucks already had the cash.

Starbucks kept 7.9% of its revenue as operating profit in fiscal 2025, down from 15% a year earlier. Running a store is expensive: in its own stores, staff, rent and the other store costs took 55.5% of sales.

Customers came less often: at North American stores, comparable transactions fell 4% while the average ticket rose 2%. The report puts the company's fall down to four things: the cost of closing stores and cutting office jobs, fewer orders carrying the same rent and staff, more barista hours to fix service, and inflation.

Late in the year it closed 627 of its own stores, 584 of them in North America. Restructuring cost $892M that year.