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Seattle, Washington-based Starbucks Corporation (SBUX) is a roaster, marketer, and retailer of coffee. Valued at a market cap of $95.1 billion, the company’s stores offer coffee, tea, and other beverages, roasted whole beans and ground coffees, and various food products, such as pastries, breakfast sandwiches, and lunch items. It is scheduled to announce its fiscal Q2 earnings for 2025 after the market closes on Tuesday, Apr. 29.
Ahead of this event, analysts expect this coffee giant to report a profit of $0.50 per share, down 26.5% from $0.68 per share in the year-ago quarter. The company has met or surpassed Wall Street's earnings estimates in three of the last four quarters, while missing on another occasion. In Q1, SBUX’s EPS of $0.69 outpaced the forecasted figure by nearly 4.6%.
For fiscal 2025, analysts expect SBUX to report a profit of $2.96 per share, down 10.6% from $3.31 in fiscal 2024. Nonetheless, its EPS is expected to rebound in 2026 and grow by 21.6% year over year to $3.60.
Shares of Starbucks have fallen 1.7% over the past 52 weeks, lagging behind both the S&P 500 Index's ($SPX) 6.6% gain, and the Consumer Discretionary Select Sector SPDR Fund’s (XLY) 8.5% rise over the same time frame.
On Apr.15, Starbucks announced new restrictions on employee dress codes, requiring baristas to wear solid black shirts and khaki, black, or blue denim bottoms under their signature green aprons starting from May 12. The company stated that the updated policy is intended to make the green aprons more visually prominent and foster a consistent brand image that customers can easily recognize. However, the move sparked backlash from employees, who criticized the company for focusing on superficial branding rather than addressing deeper concerns such as understaffing, fair labor contracts, and guaranteed work hours. The controversy weighed on investor sentiment, leading to a 2.1% drop in its stock price that day.
Nonetheless, shares of SBUX soared 8.1% on the day following its better-than-expected Q1 earnings release on Jan. 28. The company’s revenue declined marginally year-over-year to $9.4 billion but exceeded the forecasted figure by 1.1%. Moreover, its EPS of $0.69 topped the analyst estimates of $0.66 but fell 23.3% from the year-ago quarter due to a rise in operating expenses and a notable decrease in the North America segment’s net income.
Wall Street analysts are moderately optimistic about SBUX’s stock, with a "Moderate Buy" rating overall. Among 32 analysts covering the stock, 16 recommend "Strong Buy," two advise “Moderate Buy,” 11 suggest “Hold,” one indicates a “Moderate Sell,” and two give “Strong Sell” rating. The mean price target for Starbucks is $104.80, which indicates a 25.2% potential upside from the current levels.
