Starbucks on Thursday announced plans to close about 1 per cent of its North American cafes as part of its ongoing turnaround strategy.

Under Chief Executive Officer Brian Niccol, the coffee chain has been revamping its US operations, with a focus on improving the customer experience and strengthening in-person interactions at its cafes.

The latest move marks the second round of cafe closures in North America since Niccol became CEO two years ago.

Starbucks expects to shut about 250 underperforming cafes from more than 18,000 locations across North America. The company did not immediately disclose which locations would be affected.

“We have carefully reviewed our North America coffeehouse portfolio and identified locations where we do not believe we can consistently deliver the experience we want for customers and partners or where we don’t see a path to acceptable financial performance,” Mike Grams, Starbucks chief operating officer, wrote in a letter addressed to employees.

For fiscal 2026, Starbucks now expects to open a net 440 new cafes, down from its previous forecast of between 600 and 650 locations.

The new cafes will be opened in the company’s international markets, as Starbucks scales back its North American footprint.

“The Company continues to see significant longer-term growth opportunity ahead in North America and is actively developing a strong pipeline of new coffeehouses,” Starbucks said in a regulatory filing.

Most of the closures are expected to be completed before the end of fiscal 2026, according to the company’s filing. Starbucks’ fiscal year ends later this month.

The company expects the closures to result in about $300 million in restructuring charges. About $200 million of the costs will come from early lease termination and employee separation benefits.

The remaining $100 million will comprise non-cash charges related to the disposal and impairment of assets at company-owned cafes.