Date: May 16, 2026
Executive Summary
- Starbucks will lay off approximately 300 US-based employees as part of a major restructuring.
- The total restructuring cost is $400 million, including $120 million for severance payments.
- Starbucks will close regional offices in Atlanta, Burbank, Chicago, and Dallas.
- The company is reviewing its international support structure, with more job cuts expected outside the US.
- Coffeehouse operations will not be affected by these changes.
- Starbucks recently reported its strongest sales growth in over two years, despite operating profit margins nearly halving since late 2024.
- Top executives could receive $6 million each if specific cost-cutting targets are met by 2027.
Job reductions and office closures
Starbucks is trimming its workforce once again. The coffee giant will lay off about 300 US-based roles as part of a restructuring aimed at achieving “durable, profitable growth.” According to Reuters, the job reductions will affect regional support offices.
The company will consolidate its US office network and close several locations. These include offices in Atlanta, Burbank, Chicago, and Dallas. Starbucks confirmed that the changes will not impact its coffeehouse operations.
Restructuring costs and financial impact
Starbucks estimates it will spend about $120 million on severance payments linked to this layoff round. The company will also take a $280 million reduction in the book value of selected real estate assets. These assets are largely tied to its reserve and roastery sites, as well as certain non-retail support properties.
Operating profit margins have nearly halved since late 2024. However, Starbucks recently reported its strongest sales growth in more than two years. Executives described this as a milestone in the company’s turnaround strategy.
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| Item | Amount (million $) | Notes |
|---|---|---|
| Severance payments | 120 | For 300 laid-off workers |
| Real estate asset writedown | 280 | Reserve, roastery, support properties |
| Total | 400 | Full restructuring cost |
New investment and Southeast expansion
At the same time, Starbucks announced plans last month to invest $100 million to expand its presence in the US Southeast. The plan includes a new support office in Nashville, Tennessee. This office is expected to accommodate around 2,000 employees over the next five years.
The company is cutting costs in some regions while investing in others. This balanced approach reflects Starbucks’ effort to improve efficiency without abandoning growth opportunities.
Executive incentives and continued cost-cutting
Starbucks’ board linked executive incentives to the company’s cost strategy. Last summer, the board approved a plan that could give top executives $6 million each if they meet specific cost-cutting targets by 2027.
The May 2026 layoffs add to a series of workforce reductions since the turnaround began. In February last year, Starbucks eliminated 1,100 corporate positions. The company is now reviewing its international support structure and expects additional job cuts outside the United States.
Frequently Asked Questions (FAQ)
1. How many employees is Starbucks laying off in this round?
Starbucks is laying off approximately 300 US-based employees. The cuts affect regional support offices, not coffeehouse operations.
2. What is the total cost of this restructuring?
The total cost is about $400 million. This includes $120 million for severance payments and $280 million for real estate asset writedowns.
3. Will Starbucks coffeehouses be affected by these changes?
No. The company confirmed that coffeehouse operations will not be impacted. The changes are limited to support and administrative structures.
4. Are there expected layoffs outside the United States?
Yes. Starbucks is reviewing its international support structure and expects additional job cuts outside the US, though specific numbers have not been disclosed.
5. What is the executive incentive linked to cost cutting?
Top executives could receive up to $6 million each if they achieve specific cost-cutting targets set by the board, with a deadline of 2027.
6. Is this the first layoff under the current turnaround plan?
No. In February 2025, Starbucks eliminated 1,100 corporate positions. The May 2026 layoffs are part of the ongoing cost-reduction strategy.
Publication date: May 16, 2026
