Starbucks Delivery Business Surpasses $1 Billion in Annual Sales
Starbucks has officially crossed a significant milestone with its coffee delivery business, reporting $1 billion in annual sales for fiscal 2025, which ended September 30. This marks a nearly 30% increase in delivery sales during the fiscal fourth quarter compared to the same period last year, underscoring the rapid expansion of this channel for the coffee giant.
U.S. Market Sees Stabilization Amid Delivery Expansion
The delivery surge comes as Starbucks’ broader U.S. business shows signs of recovery. After seven consecutive quarters of declining same-store sales domestically, the company reported flat U.S. same-store sales in the fiscal fourth quarter. This stabilization is largely attributed to the growing adoption of delivery services, offsetting customer shifts towards home coffee preparation and competitors.
Delivery Rollout and Consumer Adoption
Starbucks first began testing delivery nearly ten years ago but was slower than many restaurant peers to scale the service nationwide. The company partnered with Uber Eats in 2020 to launch delivery across the U.S., followed by DoorDash in 2023 and Grubhub in 2024. Currently, the majority of Starbucks’ company-operated U.S. stores offer delivery. Despite this expansion, U.S. consumers have been slower to embrace coffee delivery compared to markets like China, where delivery has been more widely integrated. In the U.S., drive-thru lanes and mobile ordering provide convenient alternatives without the additional delivery fees.
Order Size and Food Inclusion Drive Delivery Growth
Starbucks indicates that delivery orders are typically nearly twice the size of in-store purchases. Furthermore, over 40% of delivery orders include food items, highlighting the channel’s role in boosting not just beverage but also food sales.
Delivery Sector Resilient Despite Broader Restaurant Spending Slowdown
While the overall restaurant sector faces headwinds from rising consumer costs leading to slower spending, the food delivery segment has remained comparatively resilient. Third-party delivery apps have retained customers through discounts, promotions, and diversification into new categories such as alcohol and grocery delivery.
FinOracleAI — Market View
Starbucks’ milestone in delivery sales reflects a strategic pivot that supports stabilization in its core U.S. market. Delivery not only drives incremental revenue but also attracts larger orders and cross-category sales, strengthening Starbucks’ competitive positioning in a challenging consumer environment.
- Opportunities: Continued expansion of delivery partnerships could further increase market penetration and convenience for customers.
- Opportunities: Leveraging delivery to promote food items enhances average order value and diversifies revenue streams.
- Risks: Delivery fees may limit adoption among price-sensitive U.S. consumers compared to alternatives like drive-thru and mobile ordering.
- Risks: Competition from rival coffee chains and independent cafes with aggressive delivery strategies could pressure Starbucks’ market share.
Impact: Starbucks’ delivery growth represents a positive catalyst, contributing to revenue diversification and supporting a turnaround in U.S. same-store sales, signaling resilience amid evolving consumer habits.
