Close-up of a Starbucks brand paper bag on an outdoor picnic table in a park, Walnut Creek, California, May 19, 2024.
Smith/gado collection | Photo archives | Getty Images
Coffee delivery has become a billion dollar business for Starbucks.
The coffee giant said Wednesday that its annual delivery sales hit the milestone in fiscal 2025, which ended Sept. 30. During the company’s fiscal fourth quarter, delivery sales soared nearly 30% compared to the same period last year, executives said.
The growth of Starbucks’ delivery initiative comes as the company’s overall U.S. operations embark on a turnaround. Starbucks reported flat U.S. same-store sales in the fiscal fourth quarter, reversing the previous seven quarters of declining same-store sales nationally as customers brewed their coffee at home or switched to competitors.
The coffee giant began testing delivery about a decade ago, but Starbucks has been slower to roll it out than many other restaurant companies. Nationwide delivery became available thanks to Uber eats in 2020, PorteDash in 2023 and Grubhub last year. Today, the vast majority of U.S. cafes run by the coffee chain offer delivery.
U.S. consumers have also been slower to adopt coffee delivery than other markets, such as China. In Starbucks’ domestic market, drive-thru and mobile ordering options offer similar convenience without the delivery costs.
Perhaps to justify the higher cost, the typical Starbucks delivery order is nearly twice the size of an in-store transaction, according to the company. More than 40% of the chain’s delivery orders include food.
Even though overall restaurant spending has slowed as consumers face higher costs, food delivery has not seen the same drop in sales. Discounts and promotions have helped third-party apps retain customers, while expanding into new categories, like alcohol and grocery delivery.