Starbucks Weathers Union Strikes as U.S. Sales Rise 4%

CEO Brian Niccol's "Back to Starbucks" plan drives strong Q1 results and record loyalty program growth despite labor unrest.

Jan. 31, 2026 at 9:55am

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Starbucks reported strong first-quarter results, with U.S. same-store sales rising 4% despite ongoing union strikes by the Starbucks Workers United (SWU) group. The company's "Back to Starbucks" turnaround strategy, led by CEO Brian Niccol, has helped drive top-line growth and a record 35.5 million members in the Starbucks Rewards loyalty program. While the strike actions garnered significant media attention, they did not significantly impact Starbucks' performance, including on its busiest holiday promotion day.

Why it matters

Starbucks' ability to weather the union strikes and deliver strong financial results underscores the effectiveness of Niccol's strategic plan to revitalize the brand and customer experience. This comes as Starbucks faces ongoing reputational challenges related to the labor disputes, highlighting the company's need to balance operational improvements with addressing underlying governance and workforce issues.

The details

Starbucks reported a 5.5% year-over-year increase in revenue to $9.9 billion in the first quarter, with 4% growth in U.S. and North America comparable sales. The company's Starbucks Rewards loyalty program reached a record 35.5 million members, with member transactions growing for the first time in eight quarters. Starbucks also saw a 3% increase in total transactions, the first rise since Q2 2022. The company credited its "Back to Starbucks" strategy, which has focused on improving the in-store experience, staffing, and technology, for the strong results.

  • On November 13, the Starbucks Workers United (SWU) union called a nationwide strike on Starbucks' Red Cup Day, one of its busiest promotional days.
  • The SWU strike actions continued through December 18, when the union issued its most recent statement, though it continues to describe the strike as open-ended.

The players

Brian Niccol

The CEO of Starbucks who has been leading the company's "Back to Starbucks" turnaround strategy.

Starbucks Workers United (SWU)

A union representing some Starbucks baristas, which has been organizing strikes and protests against the company.

Bernie Sanders

A U.S. Senator who joined Starbucks Workers United picket lines to show support for the union.

Zorhan Mandami

The mayor of New York City who also joined Starbucks Workers United picket lines.

Stephen Hahn

The chief reputation and strategy officer at corporate reputation consultancy RepTrak.

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What they’re saying

“Our brand is defined by the intersection of coffee craft, connection and community that comes to life in our coffee houses.”

— Brian Niccol, CEO, Starbucks (Forbes)

“It is clear from our top-line results that our 'Back to Starbucks' plan is working and our turnaround is taking hold.”

— Brian Niccol, CEO, Starbucks (Forbes)

“Starbucks is on the path to a reputation rebound—but the inherent risk is that the goodwill rhetoric becomes nothing more than positive intentions—and not decisive actions.”

— Stephen Hahn, Chief Reputation and Strategy Officer, RepTrak (Forbes)

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

Starbucks' ability to deliver strong financial results despite union strikes highlights the effectiveness of its "Back to Starbucks" turnaround strategy, but the company still faces ongoing reputational challenges that it must address through decisive actions, not just rhetoric.