I'll research SBUX before writing the preview. Let me pull recent earnings materials, filings, and news.Let me read the most recent earnings materials and get more context.Let me get the stock price history and any additional recent news/analyst commentary.# Starbucks (SBUX) — FQ3 2026 Earnings Preview
This is a "prove the turn is durable" quarter. After FQ2 marked the first simultaneous top- and bottom-line growth in over two years, expectations have reset sharply higher, the stock has re-rated, and the bar is now about consistency and the messy China-deconsolidation optics — not whether the turnaround is real.
Consensus is modeling a strong quarter with margin inflection: - Global comps: ~+5.75% (North America ~+6%); some sell-side (UBS) is as high as ~7%. - Operating margin: ~12.3%, up ~220 bps YoY. - EPS: ~$0.65.
For context, the compares are easy — a year ago North America comps were negative (FQ2 FY25 NA was ‑1.3%), so the Back-to-Starbucks recovery is lapping the trough of the downturn.
| Metric (FQ2 FY26) | Result |
|---|---|
| Global comps | +6.2% (transactions +3.8%, ticket +2.3%) |
| North America / U.S. comps | +7.1% / +7.1% (U.S. transactions +4.3%) |
| International comps | +2.6% (China +0.5%) |
| Consolidated revenue | $9.5B, +9% |
| Non-GAAP operating margin | 9.4%, +110 bps (CC) |
| Non-GAAP EPS | $0.50, +22% |
Key qualitative drivers management flagged: U.S. transaction growth across all income cohorts and dayparts (mornings back to ~FY22 levels), delivery growing >30% YTD, Cold Foam platform +40%, refresher "customizable energy" launch, a record 35.6M 90-day active Rewards members, and the relaunched three-tier loyalty program.
FQ3 is the first quarter reflecting the Boyu Capital joint venture (Boyu 60% / Starbucks 40%), which closed just after FQ2 quarter-end. This changes the reported picture materially: - China retail is deconsolidated and folded into the licensed portfolio; the company has stopped reporting standalone China revenue/comps (watch for the supplemental "1-pager" instead). - H2 China-related revenue will be <20% of what it would have been as company-operated → consolidated revenue guided roughly flat for FY26 despite 5%+ comps. - Expect a large one-time gain on the transaction (excluded from non-GAAP; GAAP EPS will look noisy/inflated). Starbucks received ~$3.1B gross cash, and the total deal value is pegged at >$13B including licensing NPV. - The JV is expected to be ~EPS-neutral this year but margin-accretive (roughly half of JV revenue flows to operating income).
Watch: reported revenue will optically weaken — don't confuse the accounting change with demand deterioration. Focus on comps and non-GAAP EPS.
FQ2 showed the first consolidated margin expansion since FY24, but the composition was nuanced and sets up two-sided risk into FQ3: - International margin tailwind reverses. About half of FQ2's ~790 bps international margin gain came from held-for-sale accounting (~$118M reduction to store opex/D&A). That benefit ended at the start of FQ3 — a headwind to reported international margins. - North America margin is the real tell. It contracted ~170 bps in FQ2 (to ~9.9–10.2%) on Green Apron labor investments, ~190 bps of product/distribution cost pressure (mix + tariffs + coffee), and elevated legal accruals. Investors want to see NA margin inflect positive as sales leverage builds. - Coffee & tariffs: management expects ~$1/lb YoY coffee inflation and tariff pressure to abate in H2, though results lag the spot market due to hedging. - Green Apron Service annualizes in August — so the labor investment drag begins rolling off at the tail end of FQ3/into FQ4. - $2B gross cost-savings program (through FY28) is mostly showing up in G&A this year (G&A running below FY23 levels), offsetting Back-to-Starbucks investment.
Current FY26 framework (raised at FQ2): - Global & U.S. comps ≥5% - Consolidated revenue roughly flat YoY (China effect) - Non-GAAP operating margin slightly up YoY - Non-GAAP EPS $2.25–$2.45 - 600–650 net new stores globally
Given the strong buy-side setup, the key question is whether management raises again. Note the EPS flow-through was deliberately conservative last quarter ("prudent given macro"), so another comp beat may not translate 1:1 into a guide raise. Longer-term, management reaffirmed FY28 targets (~$4 EPS implied) at January's Investor Day and declined to flow FY26 upside through — watch for any update to the out-year algo.
The fundamental story is clearly inflecting — transaction-led comps, broadening income-cohort strength, and margin discipline all point in the right direction. But three things make FQ3 tricky to read: (1) China deconsolidation muddies the reported revenue and creates a big GAAP gain; (2) the international held-for-sale margin tailwind reverses; and (3) expectations are now elevated with the stock near multi-year highs. The clean signals to cut through the noise: U.S./NA comps and transaction growth, North America margin inflection, non-GAAP EPS vs. ~$0.65, and whether management raises FY26 guidance again. A beat that isn't accompanied by NA margin progress and a confident tone on H2 cost relief could disappoint a market that's already leaning bullish.
Note: figures above are drawn from Starbucks' FQ2 FY26 release and earnings call, recent news, and market data; consensus estimates are as reported in pre-earnings news digests and may differ from your data provider's numbers.