Starbucks China posted first-quarter revenue of US$823.4 million for the fiscal quarter ended December, up 11 percent from a year earlier, with comparable store sales rising 7 percent, multiple media outlets report. The results indicate renewed momentum after some challenging years in the Chinese market.
The US-headquartered coffee giant’s chief financial officer, Cathy Smith, attributed the growth to effective marketing, expanding delivery services, and product innovation – including a partnership with the Harry Potter franchise offering limited-edition beverages and merchandise. The company has also opened new premises in 13 cities, bringing its store count up to 8,011.
A deal struck with Chinese private equity firm Boyu Capital in November is expected to fuel further growth. The strategic joint venture will see Boyu acquire a 60 percent stake in Starbucks’ retail operations in China, with the coffee chain retaining 40 percent ownership along with brand and intellectual property rights.
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Expected to close in spring 2026, the partnership is intended to reduce depreciation and operating costs, further expand Starbucks’ store network, and improve supply chain integration. Subject to regulatory approval, it will see Starbucks convert its company-operated stores into licensed outlets under its international segment.
The Boyu deal mirrors similar restructurings by Western brands in China. McDonald’s, for instance, sold 80 percent of its China and Hong Kong operations to investors including CITIC in 2017.
Starbucks first entered China in 1999 and popularised specialty coffee culture across the country. But its dominance has been eroding under intensifying competition from domestic rivals in recent years, notably Luckin Coffee – which operates over 29,000 stores and posted quarterly revenue of US$2.2 billion. Local chains like Nowwa Coffee are also expanding rapidly into lower-tier cities and regional markets, putting pressure on Starbucks’ market share.
