What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-11-20 compared with 2023-11-17 · 259 added, 257 removed, 1068 unchanged (33% of the section changed)

3 unchanged sentences

(in millions, except per share data)

Fiscal Year Ended Oct 1,

Fiscal Year Ended Sep 29,

Net revenues:

13 unchanged sentences

Operating income 5,408.8 5,870.8 4,617.8

Net gain resulting from divestiture of certain operations — — 864.5

Interest income and other, net 122.8 81.2 97.0

14 unchanged sentences

(in millions)

Fiscal Year Ended Oct 1,

Fiscal Year Ended Sep 29,

Net earnings including noncontrolling interests $ 3,762.3 $ 4,124.7 $ 3,283.4

64 unchanged sentences

(in millions)

Fiscal Year Ended Oct 1,

Fiscal Year Ended Sep 29,

OPERATING ACTIVITIES:

6 unchanged sentences

Gain on sale of assets — ( 91.3 ) —

Net gain resulting from divestiture of certain operations — — ( 864.5 )

Stock-based compensation 308.3 302.7 271.5

52 unchanged sentences

Shares Amount

Balance, September 27, 2020 1,173.3 $ 1.2 $ 373.9 $ ( 7,815.6 ) $ ( 364.6 ) $ ( 7,805.1 ) $ 5.7 $ ( 7,799.4 )

Cumulative effect of adoption of new accounting guidance — — — ( 2.2 ) — ( 2.2 ) — ( 2.2 )

Balance, October 3, 2021 1,180.0 $ 1.2 $ 846.1 $ ( 6,315.7 ) $ 147.2 $ ( 5,321.2 ) $ 6.7 $ ( 5,314.5 )

Net earnings — — — 3,281.6 — 3,281.6 1.8 3,283.4

Other comprehensive income — — — — 511.8 511.8 — 511.8

Other comprehensive loss — — — — ( 610.4 ) ( 610.4 ) — ( 610.4 )

Stock-based compensation expense — — 275.5 — — 275.5 — 275.5

1 unchanged sentence

Sale of common stock 0.6 — 46.9 — — 46.9 — 46.9

Repurchase of common stock ( 36.3 ) — ( 890.8 ) ( 3,122.2 ) — ( 4,013.0 ) — ( 4,013.0 )

Cash dividends declared, $ 2.00 per share

— — — ( 2,293.5 ) — ( 2,293.5 ) — ( 2,293.5 )

Net distributions to noncontrolling interests — — — — — — ( 0.6 ) ( 0.6 )

Balance, October 2, 2022 1,147.9 $ 1.1 $ 205.3 $ ( 8,449.8 ) $ ( 463.2 ) $ ( 8,706.6 ) $ 7.9 $ ( 8,698.7 )

10 unchanged sentences

Net earnings — — — 3,760.9 — 3,760.9 1.4 3,762.3

Other comprehensive loss — — — — ( 314.3 ) ( 314.3 ) ( 0.7 ) ( 315.0 )

Other comprehensive income — — — — 349.0 349.0 0.4 349.4

Stock-based compensation expense — — 312.0 — — 312.0 — 312.0

2 unchanged sentences

Repurchase of common stock (1)

( 12.8 ) — ( 35.2 ) ( 1,223.9 ) — ( 1,259.1 ) — ( 1,259.1 )

Cash dividends declared, $ 2.32 per share

1 unchanged sentence

Purchase of noncontrolling interests and other — — — — 0.4 0.4 ( 1.5 ) ( 1.1 )

Balance, October 1, 2023 1,142.6 $ 1.1 $ 38.1 $ ( 7,255.8 ) $ ( 778.2 ) $ ( 7,994.8 ) $ 7.0 $ ( 7,987.8 )

Balance, September 29, 2024

1,133.5 $ 1.1 $ 322.6 $ ( 7,343.8 ) $ ( 428.8 ) $ ( 7,448.9 ) $ 7.3 $ ( 7,441.6 )

(1) Includes excise tax on share repurchases.

See Notes to Consolidated Financial Statements.

17 unchanged sentences

Note 17 Segment Reporting

Note 18 Subsequent Event

STARBUCKS CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fiscal Years ended October 1, 2023, October 2, 2022 and October 3, 2021

Fiscal Years ended September 29, 2024, October 1, 2023, and October 2, 2022

Summary of Significant Accounting Policies and Estimates

Description of Business

We purchase and roast high-quality coffees that we sell, along with handcrafted coffee and tea beverages and a variety of fresh and prepared food items, through our company-operated stores.

We also sell a variety of coffee and tea products and license our trademarks through other channels such as licensed stores, grocery and foodservice.

The grocery and foodservice business is primarily through our Global Coffee Alliance with Nestlé established in August 2018.

In this 10-K, Starbucks Corporation (together with its subsidiaries) is referred to as “Starbucks,” the “Company,” “we,” “us” or “our.”

Segment information is prepared on the same basis that our management reviews financial information for operational decision-making purposes.

In the fourth quarter of fiscal 2021, certain changes were made to our management team, and our operating segment reporting structure was realigned as a result.

We realigned our fully licensed Latin America and Caribbean markets from our Americas operating segment to our International operating segment.

We renamed the Americas operating segment to the North America operating segment, since it is comprised of our company-operated and licensed stores in the U.S.

We also made certain other immaterial changes between our International operating segment and Corporate and Other.

There was no impact on consolidated net revenues, total operating expenses, operating income or net earnings per share as a result of these changes.

We purchase and roast high-quality coffees that we sell, along with handcrafted coffee, tea, and other beverages and a variety of high-quality food items through our company-operated stores.

We also sell a variety of coffee and tea products and license our trademarks through other channels, such as licensed stores as well as grocery and foodservice through our Global Coffee Alliance with Nestlé S.A.

In addition to our flagship Starbucks Coffee® brand, we sell goods and services under the following brands:

Teavana®, Ethos®, and Starbucks Reserve®.

In this Annual Report on Form 10-K (“10-K” or “Report”) for the fiscal year ended September 29, 2024 (“fiscal 2024”), Starbucks Corporation (together with its subsidiaries) is referred to as “Starbucks,” the “Company,” “we,” “us,” or “our.”

Segment information is prepared on the same basis that our ceo, who is our Chief Operating Decision Maker, manages the segments, evaluates financial results, and makes key operating decisions.

We have three reportable operating segments:

1) North America, which is inclusive of the U.S.

2) International, which is inclusive of China, Japan, Asia Pacific, Europe, Middle East and Africa, Latin America and the Caribbean;

2) International, which is inclusive of China, Japan, Asia Pacific, Europe, Middle East, Africa, Latin America, and the Caribbean;

and 3) Channel Development.

Non-reportable operating segments and unallocated corporate expenses are reported within Corporate and Other.

Unallocated corporate expenses are reported within Corporate and Other.

Additional details on the nature of our business and our reportable operating segments are included in Note 17 , Segment Reporting.

Certain prior period information on the consolidated statements of cash flows have been reclassified to conform to the current presentation.

Certain prior period information at Note 7 , Supplemental Balance Sheet and Statement of Earnings Information, has been reclassified to conform to the current presentation.

Principles of Consolidation

3 unchanged sentences

Our fiscal year ends on the Sunday closest to September 30.

Fiscal years 2023, 2022 and 2021 included 52, 52 and 53 weeks, respectively.

The 53rd week in fiscal 2021 fell in the fourth fiscal quarter.

Fiscal years 2024, 2023, and 2022 included 52 weeks.

Estimates and Assumptions

4 unchanged sentences

In fiscal 2022, we announced our plan in the U.S.

market to increase efficiency while elevating the partner and customer experience (the “Reinvention Plan”).

We believe the company-operated market investments in partner wages and trainings have increased retention and productivity while the acceleration of purpose-built store concepts and innovations in technologies have provided additional convenience and connection with our customers.

As a result of the restructuring efforts in connection with the Reinvention Plan, we recorded approximately $ 22 million and $ 46 million to restructuring and impairments on our consolidated statements of earnings during fiscal years 2023 and 2022, respectively.

Future restructuring and impairment costs attributable to our Reinvention Plan are not expected to be material.

In fiscal 2021, we substantially completed our plan to reposition our North America store portfolio, primarily in dense metropolitan markets by pursuing strategic store closures and focusing on new store formats that better cater to changing customer tastes and preferences.

During fiscal 2021, we recorded approximately $ 155.4 million to restructuring and impairments on our consolidated statements of earnings.

This total included $ 53.1 million related to disposal and impairment of company-operated store assets and $ 89.5 million primarily associated with accelerated amortization of ROU lease assets and other lease costs due to store closures prior to the end of contractual lease terms.

As this restructuring plan was substantially completed in fiscal 2021, we did not recognize any material restructuring and impairment amounts related to this plan during the fiscal years ended October 1, 2023 and October 2, 2022.

As of October 1, 2023 and October 2, 2022, there were no material restructuring-related accrued liabilities on our consolidated balance sheets.

market to increase efficiency while elevating the partner and customer experience.

As a result of these restructuring efforts, we recorded approximately $ 22 million and $ 46 million to restructuring and impairments in our consolidated statements of earnings during fiscal years 2023 and 2022, respectively.

No restructuring and impairment costs attributable to this plan were recorded in our consolidated statements of earnings during fiscal year 2024.

As of September 29, 2024, and October 1, 2023, there were no material restructuring-related accrued liabilities on our consolidated balance sheets.

Cash and Cash Equivalents

We consider all highly liquid instruments with maturities of three months or less at the time of purchase, as well as credit card receivables for sales to customers in our company-operated stores that generally settle within two to five business days, to be cash equivalents.

We consider all highly liquid instruments with maturities of three months or less at the time of purchase, as well as credit card receivables and third-party payment processing receivables for sales to customers in our company-operated stores that generally settle within two to five business days, to be cash equivalents.

We maintain cash and cash equivalent balances with financial institutions that exceed federally-insured limits.

29 unchanged sentences

We account for equity investments for which we do not have significant influence and without readily determinable fair values at cost with adjustments for observable changes in price or impairments as permitted by the measurement alternative.

Investments for which the measurement alternative has been elected are assessed for impairment quarterly, or if a triggering

event indicates impairment may be present.

Investments for which the measurement alternative has been elected are assessed for impairment quarterly, or if a triggering event indicates impairment may be present.

Any adjustments as a result of price changes or impairments are recorded in interest income and other, net on our consolidated statements of earnings.

6 unchanged sentences

The fair value of our long-term debt is estimated based on the quoted market prices for the same or similar issues or on the current rates offered to us for debt of the same remaining maturities.

We determine the fair value of our auction rate securities using an internally-developed valuation model, using inputs that include interest rate curves, credit and liquidity spreads and effective maturity.

Assets and liabilities recognized or disclosed at fair value on a nonrecurring basis may include items such as property, plant and equipment, goodwill and other intangible assets, equity and other investments and other assets.

We determine the fair value of private equity instruments using valuation models, including Black Scholes’ option pricing model and discounted cash flow models.

Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.

Assets and liabilities recognized or disclosed at fair value on a nonrecurring basis may include items such as property, plant and equipment, ROU assets, goodwill and other intangible assets, equity and other investments, and other assets.

We determine the fair value of these items using Level 3 inputs, as described in the related sections below.

1 unchanged sentence

We manage our exposure to various risks within our consolidated financial statements according to a market price risk management policy.

Under this policy, we may engage in transactions involving various derivative instruments to hedge interest rates, commodity prices and foreign currency-denominated revenue streams, inventory purchases, assets and liabilities and investments in certain foreign operations.

Under this policy, we may engage in transactions involving various derivative instruments to hedge interest rates, commodity prices, foreign currency-denominated revenue streams, inventory purchases, and assets, liabilities, and investments in certain foreign operations.

In order to manage our exposure to these risks, we use various types of derivative instruments including forward contracts, commodity futures contracts, collars, and swaps.

5 unchanged sentences

Cash flows from derivative financial instruments and the related gains and losses are classified as cash flows from operating activities on the consolidated statements of cash flows.

Excluding interest rate hedging instruments, cross-currency swaps and foreign currency debt hedging instruments, we generally do not enter into derivative instruments with maturities longer than three years.

Excluding interest rate hedging instruments and cross-currency swaps, we generally do not enter into derivative instruments with maturities longer than three years.

However, we are allowed to net settle transactions with respective counterparties for certain derivative contracts, inclusive of interest rate swaps and foreign currency forwards, with a single, net amount payable by one party to the other.

We also enter into collateral security arrangements that provide for collateral to be received or posted when the net fair value of certain financial instruments fluctuates from contractually established thresholds.

As of October 1, 2023 and October 2, 2022, cash collateral held under collateral security arrangements was $ 77.1 million and $ 74.3 million, respectively, and is included in other long-term liabilities on our consolidated balance sheets.

As of October 1, 2023 and October 2, 2022, cash collateral pledged as part of our commodity derivative margin requirements was $ 20.6 million and $ 75.6 million, respectively, and is included in prepaid expenses and other current assets on our consolidated balance sheets.

As of September 29, 2024, and October 1, 2023, cash collateral received under collateral security arrangements was $ 230.9 million and $ 77.1 million, respectively, and is included in other long-term liabilities on our consolidated balance sheets.

As of September 29, 2024, and October 1, 2023, cash collateral pledged as part of our commodity derivative margin requirements was $ 12.4 million and $ 20.6 million, respectively, and is included in prepaid expenses and other current assets on our consolidated balance sheets.

The potential effects of netting arrangements with our derivative contracts, excluding the effects of collateral, would not have had a material impact on our consolidated balance sheets.

We also hold cash and cash equivalents from various settled-to-market exchange traded futures related to coffee and dairy hedging.

By using these derivative instruments, we expose ourselves to potential credit risk.

16 unchanged sentences

Normal Purchase Normal Sale

We enter into fixed-price and price-to-be-fixed green coffee purchase commitments, which we expect to take delivery and to utilize in a reasonable period of time in the ordinary course of business.

We enter into fixed-price and price-to-be-fixed green coffee purchase commitments, which we expect will result in physical delivery and utilization in the ordinary course of business in a reasonable period of time.

Since these types of purchase commitments qualify for the normal purchase normal sale exemption, they are not recorded as derivative instruments on our consolidated balance sheets.

2 unchanged sentences

Our receivables are mainly generated from product and equipment sales to, and royalties from, our licensees, as well as from our Global Coffee Alliance and other Channel Development customers.

The primary indicators of the credit quality of our receivables are aging, payment history, economic sector information and outside credit monitoring, and are assessed on a quarterly basis.

The primary indicators of the credit quality of our receivables are aging, payment history, economic sector information, and outside credit monitoring.

These indicators are assessed on a quarterly basis.

Our credit loss exposure is mainly concentrated in our accounts receivable portfolio.

Our allowance for credit losses is calculated using a loss-rate method based on historical experience, current market conditions, and reasonable forecasts.

For the fiscal year ended October 1, 2023, we did not observe a significant deterioration of our receivable portfolio that required a significant increase in our allowance for credit losses.

As of October 1, 2023 and October 2, 2022, our allowance for credit losses was $ 23.8 million and $ 27.2 million, respectively.

For the fiscal year ended September 29, 2024, we did not observe a significant deterioration of our receivable portfolio that required a significant increase in our allowance for credit losses.

As of September 29, 2024, and October 1, 2023, our allowance for credit losses was $ 21.2 million and $ 23.8 million, respectively.

Inventories are stated at the lower of cost (primarily moving average cost) or net realizable value.

1 unchanged sentence

Inventory reserves are based on inventory obsolescence trends, historical experience, and application of the specific identification method.

As of October 1, 2023 and October 2, 2022, inventory reserves were $ 44.4 million and $ 43.1 million, respectively.

As of September 29, 2024, and October 1, 2023, inventory reserves were $ 58.0 million and $ 44.4 million, respectively.

Property, Plant and Equipment

Property, plant and equipment is carried at cost less accumulated depreciation.

Cost includes all direct costs necessary to acquire and prepare assets for use, including internal labor and overhead in some cases.

Depreciation is computed using the straight-line method over estimated useful lives of the assets, generally ranging from 2 to 15 years for equipment and 30 to 40 years for buildings.

Cost includes all direct costs necessary to acquire and prepare assets for use or to develop or obtain internal-use software, including internal labor and overhead in some cases.

Depreciation is computed using the straight-line method over estimated useful lives of the assets, generally ranging from 2 to 15 years for equipment, 30 to 40 years for buildings, and 2 to 8 years for capitalized software.

Leasehold improvements are amortized over the shorter of their estimated useful lives or the related lease life, generally 10 years.

1 unchanged sentence

If failure to exercise a renewal option imposes a significant economic penalty to us, we may determine at the inception of the lease that renewal is reasonably assured and include the renewal option period in the determination of the appropriate estimated useful lives.

Capitalized software includes the costs of developing or obtaining internal-use software, such as external direct costs of materials and services, payroll and benefits costs, interest costs, and costs to develop or obtain software that allows for access or conversion of historical data by new systems.

We capitalize costs when the preliminary project stage is complete, management has authorized and committed to funding the software project, it is probable that the software project will be completed, and it is probable that the software will be used to perform the intended function.

The portion of depreciation expense related to production and distribution facilities is included in product and distribution costs on our consolidated statements of earnings.

4 unchanged sentences

When evaluating for impairment, we first compare the carrying value of the asset to the asset’s estimated future undiscounted cash flows.

If the estimated undiscounted future cash flows are less than the carrying value of the asset, we determine if we have an impairment loss by comparing the carrying value of the asset to the asset's estimated fair value and recognize an impairment charge when the asset’s carrying value exceeds its estimated fair value.

If the estimated undiscounted future cash flows are less than the carrying

value of the asset, we determine if we have an impairment loss by comparing the carrying value of the asset to the asset’s estimated fair value and recognize an impairment charge when the asset’s carrying value exceeds its estimated fair value.

The fair value of the asset is estimated using a discounted cash flow model based on forecasted future revenues and operating costs, using internal projections.

2 unchanged sentences

We recognized net disposition and impairment charges of $ 94.0 million, $ 91.1 million, and $ 66.6 million in fiscal 2024, 2023, and 2022, respectively.

We recorded $ 23.2 million, $ 14.3 million and $ 44.4 million of impairment losses within store operating expenses on our consolidated statements of earnings during the fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021, respectively.

Of the total net disposition and impairment charges recorded in fiscal 2022 and 2021, $ 9.6 million and $ 53.1 million, respectively, were restructuring related and recorded in restructuring and impairment expenses.

Included in these amounts, we recorded $ 23.3 million, $ 23.2 million, and $ 14.3 million of impairment losses within store operating expenses on our consolidated statements of earnings during the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022, respectively.

Of the total net disposition and impairment charges recorded in fiscal 2022, $ 9.6 million was restructuring related and recorded in restructuring and impairment expenses.

Unless it is restructuring related, the nature of the underlying asset that is impaired or disposed of will determine the operating expense line on which the related impact is recorded on our consolidated statements of earnings.

13 unchanged sentences

Therefore, we typically use market and term-specific incremental borrowing rates.

Our incremental borrowing rate for a lease is the rate of interest we expect to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms.

Our incremental borrowing rate for a lease is the rate of interest we expect to pay on a collateralized basis to borrow an amount under similar terms.

Because we do not borrow on a collateralized basis, we consider a combination of factors, including our credit-adjusted risk-free interest rate, the risk profile and funding cost of the specific geographic market of the lease, the lease term, and the effect of adjusting the rate to reflect consideration of collateral.

3 unchanged sentences

We recognize operating lease costs on a straight-line basis over the lease term.

In addition to the above costs, variable lease costs also include amounts based on a percentage of gross sales in excess of specified levels and are recognized when probable and are not included in determining the present value of our lease liability.

In addition to the above costs, variable lease costs also include amounts based on a percentage of gross sales in excess of specified levels, the costs of which are recognized when probable and are not included in determining the present value of our lease liability.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

A significant majority of our leases are related to our company-operated stores, and their related costs are recorded within store operating expenses.

A significant majority of our leases are related to our company-operated stores, and the related costs are recorded within store operating expenses.

The ROU asset is measured at the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, initial direct costs, and any tenant improvement allowances received.

5 unchanged sentences

See Note 10 , Leases, for additional details.

For the fiscal year ended October 3, 2021, we recognized accelerated amortization of ROU lease assets and other lease costs of $ 89.5 million, due to planned store closures prior to the end of contractual lease terms, which were recorded in restructuring and impairments on the consolidated statement of earnings.

In fiscal 2021, we substantially completed our plan to optimize our North America store portfolio, and we did not recognize any material restructuring and impairment amounts related to this plan during fiscal 2023 and fiscal 2022.

We evaluate goodwill for impairment annually during our third fiscal quarter, or more frequently if an event occurs or circumstances change, such as material deterioration in performance or a significant number of store closures, that would indicate that impairment may exist.

When evaluating goodwill for impairment, we may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit is impaired.

14 unchanged sentences

These assets are amortized over their estimated useful lives and are tested for impairment using a similar methodology to our property, plant and equipment, as described above.

Indefinite-lived intangibles, which consist primarily of trade names and trademarks, are tested for impairment annually during the third fiscal quarter, or more frequently if an event occurs or circumstances change that would indicate that impairment may exist.

When evaluating other intangible assets for impairment, we may first perform a qualitative assessment to determine whether it is more likely than not that an intangible asset group is impaired.

6 unchanged sentences

Insurance Reserves

We use a combination of insurance and self-insurance mechanisms, including a wholly-owned captive insurance entity and participation in a reinsurance treaty, to provide for the potential liabilities for certain risks, including workers’ compensation, healthcare benefits, general liability, property insurance and director and officers’ liability insurance.

Liabilities associated with the risks that are retained by us are not discounted and are estimated, in part, by considering historical claims experience, demographics, exposure and severity factors, and other actuarial assumptions.

1 unchanged sentence

Consolidated revenues are presented net of intercompany eliminations for wholly-owned subsidiaries and investees controlled by us and for product sales to, and royalty and other fees from, licensees accounted for under the equity method.

Additionally,

consolidated revenues are recognized net of any discounts, returns, allowances and sales incentives, including coupon redemptions and rebates.

Additionally, consolidated revenues are recognized net of any discounts, returns, allowances, and sales incentives, including coupon redemptions and rebates.

Company-operated Store Revenues

Company-operated store revenues are recognized when payment is tendered at the point-of-sale as the performance obligation has been satisfied.

For products sold via delivery platforms, contractual terms are evaluated for each service provider to determine gross versus net presentation and revenues are also recognized when control of products are transferred to the customers.

For products sold via delivery platforms, contractual terms are evaluated for each service provider to

determine gross versus net presentation, and revenues are also recognized when control of products are transferred to the customers.

Delivery service fees were immaterial in the periods presented.

12 unchanged sentences

Historically, the majority of stored value cards are redeemed within one year.

In many of our company-owned markets, including the U.S., our stored value cards do not have an expiration date nor do we charge service fees that cause a decrement to customer balances.

In many of our company-operated markets, including the U.S., our stored value cards do not have an expiration date, nor do we charge service fees that cause a decrement to customer balances.

Based on historical redemption rates, a portion of stored value cards is not expected to be redeemed and will be recognized as breakage over time in proportion to stored value card redemptions.

1 unchanged sentence

Breakage is recognized as company-operated stores and licensed stores revenue within the consolidated statement of earnings.

For the fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021, we recognized breakage revenue of $ 196.1 million, $ 196.0 million and $ 164.5 million in company-operated store revenues, respectively, and $ 18.9 million, $ 16.7 million and $ 16.6 million in licensed store revenues, respectively.

For the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022, we recognized breakage revenue of $ 187.6 million, $ 196.1 million, and $ 196.0 million in company-operated store revenues, respectively, and $ 20.0 million, $ 18.9 million, and $ 16.7 million in licensed store revenues, respectively.

Loyalty Program

Customers in the U.S., Canada and certain other countries who register their Starbucks Card are automatically enrolled in the Starbucks Rewards program, which is primarily a spend-based loyalty program.

Customers in the U.S., Canada, and certain other countries who register their stored value card are automatically enrolled in the Starbucks Rewards program, which is primarily a spend-based loyalty program.

They earn loyalty points (“Stars”) in a variety of ways, including with each purchase at participating Starbucks stores.

3 unchanged sentences

This deferral is based on the estimated value of the product for which the reward is expected to be redeemed, net of estimated unredeemed Stars.

Stars generally expire after six months.

Stars generally expire after six to twelve months, depending on the market.

When a customer redeems an earned reward, we recognize revenue for the redeemed product and reduce the related deferred revenue.

10 unchanged sentences

Product and Distribution Costs

Product and distribution costs primarily consist of raw materials, purchased goods, packaging costs and delivery-related expenses as well as operational costs of our supply chain organization, such as wages and benefits, occupancy costs and depreciation expenses, in support of sourcing, procuring, manufacturing, warehousing and transportation activities of products sold at our company-operated and licensed stores as well as through Channel Development and our other businesses.

Also included are inventory and supply chain asset impairment costs.

Product and distribution costs primarily include expenses related to raw materials, purchased goods, packaging, and delivery, along with operational costs of our supply chain organization.

This encompasses wages, benefits, occupancy costs, and depreciation associated with sourcing, procuring, manufacturing, warehousing, and transportation of products sold at our company-operated and licensed stores, as well as through Channel Development and our other businesses.

Additionally, it includes costs related to inventory and supply chain asset impairment s.

Store Operating Expenses

1 unchanged sentence

General and Administrative Expenses

General and administrative expenses primarily consist of wages and benefits, professional service fees and occupancy costs for corporate headquarters and regional offices that support our corporate functions, including technology, finance, legal and partner resources .

General and administrative expenses primarily consist of wages and benefits, professional service fees, and occupancy costs for corporate headquarters and regional offices that support our corporate functions .

We expense most advertising costs as they are incurred, except for certain production costs that are expensed the first time the advertising takes place.

Advertising expenses totaled $ 597.3 million, $ 507.8 million, and $ 416.7 million in fiscal 2024, 2023, and 2022, respectively.

Government Subsidies

On March 27, 2020, the U.S.

government enacted the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), which among other things, provided employer payroll tax credits for wages paid to employees who are unable to work during the COVID-19 pandemic and options to defer payroll tax payments for a limited period.

Based on our evaluation of the CARES Act, we qualified for certain employer payroll tax credits as well as the deferral of payroll tax payments in the future.

Additionally, the Canadian government enacted the Canada Emergency Wage Subsidy (“CEWS”) to help employers offset a portion of their employee wages for a limited period.

We elected to treat qualified government subsidies from the U.S., Canada and other governments as offsets to the related operating expenses.

The CARES Act and CEWS were no longer applicable to us in late fiscal 2021.

The qualified payroll credits reduced our store operating expenses by $ 210.0 million on our consolidated statement of earnings during fiscal 2021.

After netting the qualified credits against our payable, a receivable balance of $ 15.6 million and $ 69.4 million was included in prepaid expenses and other current assets as of October 1, 2023 and October 2, 2022, respectively.

As of October 1, 2023, the deferred payroll tax payments have been remitted in full.

As of October 2, 2022, deferred payroll tax payments of $ 116.5 million were included in accrued liabilities on our consolidated balance sheets.

Store Preopening Expenses

2 unchanged sentences

We recognize a liability for the fair value of required asset retirement obligations (“ARO”) when such obligations are incurred.

Our AROs are primarily associated with leasehold improvements, which, at the end of a lease, we are contractually obligated to remove in order to comply with the lease agreement.

Our AROs are primarily associated with leasehold improvements, which, at the end of a lease, we are contractually obligated to remove to comply with the lease agreement.

At the inception of a lease with such conditions, we record an ARO liability and a corresponding capital asset in an amount equal to the estimated fair value of the obligation.

2 unchanged sentences

Upon satisfaction of the ARO conditions, any difference between the recorded ARO liability and the actual retirement costs incurred is recognized as a gain or loss in store operating expenses on our consolidated statements of earnings.

As of October 1, 2023 and October 2, 2022, our net ARO assets included in property, plant and equipment were $ 25.6 million and $ 26.1 million, respectively, and our net ARO liabilities included in other long-term liabilities were $ 110.3 million and $ 104.7 million, respectively.

As of September 29, 2024, and October 1, 2023, our net ARO assets included in property, plant and equipment were $ 25.1 million and $ 25.6 million, respectively, and our net ARO liabilities included in other long-term liabilities were $ 119.2 million and $ 110.3 million, respectively.

Stock-based Compensation

5 unchanged sentences

Expense for performance-based RSUs is recognized when it is probable the performance goal will be achieved.

Performance goals are determined by the Board and may include measures such as earnings per share, operating income, return on invested capital, total shareholder return and metrics focused on building inclusive and diverse teams.

The fair value of each stock option granted is estimated on the grant date using the Black-Scholes-Merton option valuation model.

Performance goals are determined by the Board and may include measures such as earnings per share, operating income, return on invested capital, total shareholder return, and metrics focused on talent and sustainability.

The fair value of RSUs is based on the closing price of Starbucks common stock on the award date, less the present value of the dividends expected to be paid on the underlying shares during the vesting period.

The fair value of each stock option granted is estimated on the grant date using the Black-Scholes-Merton option valuation

The assumptions used to calculate the fair value of options granted are evaluated and revised, as necessary, to reflect market conditions and our historical experience.

The fair value of RSUs is based on the closing price of Starbucks common stock on the award date, less the present value of expected dividends not received during the vesting period.

If applicable, our total shareholder return relative to our peer group is incorporated into the underlying assumptions using a Monte Carlo simulation valuation model to calculate grant date fair value.

The related assumptions used in the Monte Carlo simulation valuation model include expected term, volatility, dividend yield, and risk-free interest rate.

Compensation expense is recognized over the requisite service period for each separately vesting portion of the award, and only for those awards expected to vest, with forfeitures estimated at the date of grant based on our historical experience and future expectations.

15 unchanged sentences

For uncertain tax positions that do not meet this threshold, we record a related liability.

We adjust our unrecognized tax benefit liability and income tax expense in the

period in which the uncertain tax position is effectively settled, the statute of limitations expires for the relevant taxing authority to examine the tax position or when new information becomes available.

We adjust our unrecognized tax benefit liability and income tax expense in the period in which the uncertain tax position is effectively settled, the statute of limitations expires for the relevant taxing authority to examine the tax position, or when new information becomes available.

Starbucks recognizes interest and penalties related to income tax matters in income tax expense on our consolidated statements of earnings.

17 unchanged sentences

The adoption of the new guidance did not have a material impact on our financial statements.

In June 2016, the FASB issued guidance replacing the incurred loss impairment methodology with a new methodology that reflects current expected credit losses on financial assets, including receivables and available-for-sale securities.

The new methodology requires entities to estimate and recognize expected credit losses each reporting period.

The guidance was adopted during the first quarter of fiscal 2021 under the modified retrospective approach and resulted in a $ 2.2 million transition adjustment to opening shareholders’ retained deficit on our consolidated statements of equity.

Recent Accounting Pronouncements Not Yet Adopted

In November 2023, the FASB issued guidance expanding segment disclosure requirements.

The amendments require enhanced disclosure for certain segment items and disclosure on how management uses reported measures to assess segment performance.

The amendments do not change how segments are determined, aggregated, or how thresholds are applied to determine reportable segments.

We expect to adopt the guidance for the fiscal year ending September 28, 2025.

We are currently evaluating the expanded disclosure requirements and do not expect the adoption of this guidance to have a significant impact on our consolidated financial statement disclosures.

In December 2023, the FASB issued guidance expanding disclosure requirements related to income taxes.

The amendments require enhanced jurisdictional disclosures for the income tax rate reconciliation and related to cash income taxes paid.

Additionally, certain disclosures related to unrecognized tax benefits and indefinite reinvestment assertions were removed.

The amendments are effective for our fiscal year ending September 27, 2026.

While we are still evaluating the specific impacts and timing of adoption, we anticipate this guidance will have a significant impact on our annual income tax disclosures.

In March 2024, the SEC issued its final climate disclosure rules, which require the disclosure of climate-related information in annual reports and registration statements.

The rules require disclosure in the audited financial statements of certain effects of severe weather events and other natural conditions above certain financial thresholds, as well as amounts related to carbon offsets and renewable energy credits or certificates, if material.

Under the rules as originally issued, disclosure requirements begin phasing in for fiscal years beginning on or after January 1, 2025.

However, on April 4, 2024, the SEC determined to voluntarily stay the final rules pending certain legal challenges.

We are currently evaluating the impact of the new rules and continue to monitor the status of the related legal challenges.

In November 2024, the FASB issued guidance expanding disclosure requirements related to certain income statement expenses.

The amendments require tabular disclosure of certain operating expenses disaggregated into categories, such as purchases of inventory, employee compensation, depreciation, and intangible asset amortization.

The amendments are effective for our fiscal year ending October 1, 2028, and may be applied retrospectively.

While we are still evaluating the specific impacts and adoption method, we anticipate this guidance will have a significant impact on our consolidated financial statement disclosures.

Acquisitions, Divestitures, and Strategic Alliance

On January 13, 2023, we sold the assets, primarily consisting of intellectual properties associated with the Seattle’s Best Coffee brand, to Nestlé for $ 110.0 million.

The transaction resulted in a pre-tax gain of $ 91.3 million, which was included in gain from sale of assets on our consolidated statements of earnings.

The transaction resulted in a pre-tax gain of $ 91.3 million, which was included in gain from sale of assets on our consolidated statement of earnings for the fiscal year ended October 1, 2023.

Results from Seattle’s Best Coffee operations prior to the sale are reported in our Channel Development operating segment.

1 unchanged sentence

This transaction did not have a material impact on our consolidated financial statements.

In the fourth quarter of fiscal 2021, we sold our 50 % ownership interest in Starbucks Coffee Korea Co., Ltd.

where our joint venture partner, E-Mart Inc., acquired an additional 17.5 % interest and Apfin Investment Pte Ltd, an affiliate of GIC Private Limited, which is a Singapore sovereign wealth fund, acquired the remaining 32.5 %.

The sale had a combined price of $ 1.175 billion.

This transaction resulted in a pre-tax gain of $ 864.5 million, which is included in net gain resulting from divestiture of certain operations on our consolidated statements of earnings.

Derivative Financial Instruments

1 unchanged sentence

From time to time, we enter into designated cash flow hedges to manage the variability in cash flows due to changes in benchmark interest rates.

We enter into interest rate swap agreements, including forward-starting interest rate swaps and

treasury locks, settled in cash based upon the difference between an agreed-upon benchmark rate and the prevailing benchmark rate at settlement.

We enter into interest rate swap agreements, including forward-starting interest rate swaps and treasury locks, settled in cash based upon the difference between an agreed-upon benchmark rate and the prevailing benchmark rate at settlement.

These agreements are generally settled around the time of the pricing of the related debt.

1 unchanged sentence

To hedge the exposure to changes in the fair value of our fixed-rate debt, we enter into interest rate swap agreements, which are designated as fair value hedges.

The changes in fair values of these derivative instruments and the offsetting changes in fair values of the underlying hedged debt due to changes in the relevant benchmark interest rates are recorded in interest expense.

The changes in fair values of these derivative instruments and the offsetting changes in fair

values of the underlying hedged debt due to changes in the relevant benchmark interest rates are recorded in interest expense.

Refer to Note 9 , Debt, for additional information on our long-term debt.

Foreign Currency

To reduce cash flow volatility from foreign currency fluctuations, we enter into forward and swap contracts to hedge portions of cash flows of anticipated intercompany royalty payments, inventory purchases and intercompany borrowing and lending activities.

To reduce cash flow volatility from foreign currency fluctuations, we enter into forward and swap contracts to hedge portions of cash flows of anticipated royalty revenue, inventory purchases, and intercompany borrowing and lending activities.

The resulting gains and losses from these derivatives are recorded in AOCI and subsequently reclassified to revenue, product and distribution costs, or interest income and other, net, respectively, when the hedged exposures affect net earnings.

10 unchanged sentences

Cash flows from hedging transactions are classified in the same categories as the cash flows from the respective hedged items.

For de-designated cash flow hedges in which the underlying transactions are no longer probable of occurring, the related accumulated derivative gains or losses are recognized in interest income and other, net on our consolidated statements of earnings.

For de-designated cash flow hedges in which the underlying transactions are no longer probable of occurring or where price variability in the underlying cash flow ceases to exist, the related accumulated derivative gains or losses are recognized in interest income and other, net on our consolidated statements of earnings.

These derivatives may be accounted for prospectively as non-designated derivatives until maturity, re-designated to new hedging relationships, or terminated early.

We continue to believe transactions related to our other designated cash flow hedges are probable to occur.

We continue to believe transactions related to our designated cash flow hedges are probable to occur.

To mitigate the price uncertainty of a portion of our future purchases, including diesel fuel and other commodities, we enter into swap contracts, futures, and collars that are not designated as hedging instruments.

29 unchanged sentences

Interest rates — 0.3 50.3 ( 4.0 ) 1.4 ( 2.0 ) Interest expense

— — ( 3.6 ) Interest income and other, net

Net Investment Hedges:

6 unchanged sentences

Location of gain/(loss) recognized in earnings Year Ended

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Non-Designated Derivatives:

7 unchanged sentences

Notional amounts of outstanding derivative contracts (in millions) :

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Coffee $ 154 $ 266

5 unchanged sentences

Derivative Assets

Balance Sheet Location Oct 1, 2023 Oct 2, 2022

Balance Sheet Location Sep 29, 2024 Oct 1, 2023

Designated Derivative Instruments (1) :

Cross-currency swaps Other long-term assets $ 130.1 $ 115.4

Cross-currency swaps Prepaid expenses and other current assets

Other long-term assets 177.4 130.1

Dairy Prepaid expenses and other current assets 0.8 0.4

4 unchanged sentences

Non-designated Derivative Instruments:

Dairy Prepaid expenses and other current assets 0.3 —

Diesel fuel and other commodities Prepaid expenses and other current assets — 0.7

Foreign currency Prepaid expenses and other current assets 1.8 7.5

Other long-term assets — 7.3

Derivative Liabilities

Balance Sheet Location Oct 1, 2023 Oct 2, 2022

Balance Sheet Location Sep 29, 2024 Oct 1, 2023

Designated Derivative Instruments:

Cross-currency swaps Accrued liabilities

Other long-term liabilities 33.3 —

Dairy Accrued liabilities — 1.1

Foreign currency - other Accrued liabilities 4.7 2.0

Other long-term liabilities 4.1 —

Interest rate swaps

Accrued liabilities — 12.0

Other long-term liabilities 19.2 41.4

Non-designated Derivative Instruments:

Diesel fuel and other commodities Accrued liabilities

Foreign currency Accrued liabilities 2.5 0.5

Other long-term liabilities 0.1 1.8

(1) We also hold cash and cash equivalents from various settled-to-market exchange traded futures related to coffee and dairy hedging.

The following amounts were recorded on the consolidated balance sheets related to fixed-to-floating interest rate swaps designated in fair value hedging relationships (in millions) :

Carrying amount of hedged item Cumulative amount of fair value hedging adjustment included in the carrying amount

Oct 1, 2023 Oct 2, 2022 Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023 Sep 29, 2024 Oct 1, 2023

Location on the balance sheet

1 unchanged sentence

$ 332.2 $ 1,060.0 $ ( 17.8 ) $ ( 40.0 )

(1) Includes $750 million in Senior Notes that matured on October 1, 2023 but remained in current portion of long-term debt on the consolidated balance sheet as the debt repayment was not made until the first day of fiscal 2024.

(1) Balance as of October 1, 2023, includes $750 million in senior notes that matured on October 1, 2023, but remained in current portion of long-term debt on the consolidated balance sheet as the debt repayment was not made until the first day of fiscal 2024.

Additional disclosures related to cash flow gains and losses included in AOCI, as well as subsequent reclassifications to earnings, are included in Note 12 , Equity .

2 unchanged sentences

Fair Value Measurements at Reporting Date Using

October 1, 2023 Quoted Prices

September 29, 2024 Quoted Prices

Identical Assets

5 unchanged sentences

Corporate debt securities 51.8 — 51.8 —

Foreign corporate bonds 0.2 — 0.2 —

Mortgage and other asset-backed securities 0.4 — 0.4 —

State and local government obligations 1.4 — 1.4 —

government treasury securities 36.9 36.9 — —

Foreign government obligations 3.9 — 3.9 —

Total available-for-sale debt securities 90.7 36.9 53.8 —

10 unchanged sentences

government treasury securities 94.9 94.9 — —

Total Available-for-sale debt securities 275.8 94.9 169.9 11.0

Structured Deposit 0.2 — 0.2 —

Total long-term investments 276.0 94.9 170.1 11.0

18 unchanged sentences

Corporate debt securities 64.0 — 64.0 —

Foreign government obligations 3.9 — 3.9 —

government treasury securities 2.8 2.8 — —

8 unchanged sentences

Corporate debt securities 91.1 — 91.1 —

Foreign government obligations 3.8 — 3.8 —

Mortgage and other asset-backed securities 50.2 — 50.2 —

13 unchanged sentences

Available-for-sale Debt Securities

Long-term in vestments generally mature within 5 years .

Long-term in vestments generally mature with in 5 years .

Proceeds from sales of securities we re $ 1.3 million, $ 2.5 million, and $ 72.6 million for fiscal 2024, 2023, and 2022, respectively.

Realized gains and losses were not material f or fiscal 2024, 2023, and 2022.

Gross unrealized holding gains and losses were not material as of October 1, 2023 and October 2, 2022.

Gross unrealized holding gains and losses were not material as of September 29, 2024, and October 1, 2023.

Marketable Equity Securities

1 unchanged sentence

Our marketable equity securities portfolio approximates a portion of our liability under our MDCP, a defined contribution plan.

Our MDCP liability was $ 90.4 million and $ 85.9 million as of October 1, 2023 and October 2, 2022, respectively.

Our MDCP liability was $ 112.3 million and $ 90.4 million as of September 29, 2024, and October 1, 2023, respectively.

The changes in net unrealized holding gains and losses in the marketable equity securities portfolio included in earnings for fiscal 2024, 2023, and 2022 were not material.

Gross unrealized holding gains and losses on marketable equity securities were not material as of October 1, 2023 and October 2, 2022 .

Gross unrealized holding gains and losses on marketable equity securities were not material as of September 29, 2024, and October 1, 2023 .

Derivative Assets and Liabilities

4 unchanged sentences

Impairment of property, plant and equipment and ROU assets is included in Note 1 , Summary of Significant Accounting Policies and Estimates.

We recognized impairments during fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021.

Impairments recognized in the fiscal year ended October 3, 2021 were primarily related to our restructuring plan.

See Note 1 , Summary of Significant Accounting Policies and Estimates and Note 10 , Leases for additional discussion of these impairments.

We recognized impairments during fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022.

See Note 1 , Summary of Significant Accounting Policies and Estimates for additional discussion of these impairments.

Fair Value of Other Financial Instruments

1 unchanged sentence

Inventories (in millions)

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Unroasted $ 665.1 $ 747.7

5 unchanged sentences

Inventory levels vary due to seasonality, commodity market supply, and price fluctuations.

As of October 1, 2023, we had committed to purchasing green coffee totaling $ 412 million under fixed-price contracts and an estimated $ 577 million under price-to-be-fixed contracts.

As of September 29, 2024, we had committed to purchasing green coffee totaling $ 180 million under fixed-price contracts and an estimated $ 929 million under price-to-be-fixed contracts.

A portion of our price-to-be-fixed contracts are effectively fixed through the use of futures.

6 unchanged sentences

Equity Investments (in millions)

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Equity method investments $ 424.1 $ 415.7

2 unchanged sentences

Equity Method Investments

As of October 1, 2023, we had a 50 % ownership interest in Tata Starbucks Limited (India), which operates licensed Starbucks ® retail stores.

As of September 29, 2024, we had a 50 % ownership interest in Tata Starbucks Limited (India), with a carrying value of $ 41.1 million.

Tata Starbucks Limited (India) operates licensed Starbucks ® retail stores.

We also license the rights to produce and distribute Starbucks-branded products to our 50 % owned joint venture, The North American Coffee Partnership with the Pepsi-Cola Company, which develops and distributes bottled Starbucks ® beverages,

including Frappuccino coffee drinks, Starbucks Doubleshot espresso drinks, Starbucks ® Iced Espresso Classics, and Starbucks ® Iced Coffee.

As of September 29, 2024, the carrying value of this investment was $ 112.3 million.

Our share of income and losses from our equity method investments is included in income from equity investees on our consolidated statements of earnings.

2 unchanged sentences

Related product and distribution costs were $ 58.6 million, $ 85.6 million, and $ 76.5 million in fiscal 2024, 2023, and 2022, respectively.

As of October 1, 2023 and October 2, 2022, there were $ 19.1 million and $ 14.8 million of accounts receivable from equity investees, respectively, on our consolidated balance sheets, primarily related to product sales and royalty revenues.

We also hold equity interests in other entities to support our corporate and investment strategies, including our limited partnership interest in Valor Siren Ventures I L.P.

As of September 29, 2024, and October 1, 2023, there were $ 12.2 million and $ 19.1 million of accounts receivable from equity investees, respectively, on our consolidated balance sheets, primarily related to product sales and royalty revenues.

We also hold equity interests in other entities to support our corporate and investment strategies, which are not core to our business, including our limited partnership interest in Valor Siren Ventures I L.P.

and Valor Siren Ventures II L.P, which are private equity funds investing in technologies, products, and solutions relating to food or retail.

The related financial statements activities were not material during the periods presented.

The total carrying value of these investments was $ 211.9 million as of September 29, 2024.

Our share of income and losses from these private equity interests is included in interest income and other, net on our consolidated statements of earnings.

The related financial statement activities were not material during the periods presented.

Additional disclosure regarding changes in our equity method investments due to acquisition or divestiture is included in Note 2 , Acquisitions, Divestitures and Strategic Alliance.

5 unchanged sentences

Property, Plant and Equipment, net

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Land $ 56.9 $ 46.1

3 unchanged sentences

Roasting equipment 865.7 859.4

Capitalized software

1,049.7 897.2

Furniture, fixtures and other 775.5 767.3

4 unchanged sentences

Accrued Liabilities

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Accrued occupancy costs $ 81.7 $ 86.7

6 unchanged sentences

Store Operating Expenses

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Wages and benefits $ 8,828.6 $ 8,733.4 $ 8,157.7

4 unchanged sentences

Indefinite-Lived Intangible Assets

(in millions) Oct 1, 2023 Oct 2, 2022

(in millions) Sep 29, 2024 Oct 1, 2023

Trade names, trademarks, and patents

$ 79.5 $ 79.4

Finite-Lived Intangible Assets

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

(in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

2 unchanged sentences

Trade names, trademarks, and patents

130.4 ( 110.0 ) 20.4 131.0 ( 91.9 ) 39.1

Licensing agreements 13.4 ( 12.4 ) 1.0 13.0 ( 11.0 ) 2.0

2 unchanged sentences

Amortization expense for finite-lived intangible assets was $ 20.4 million, $ 21.5 million, and $ 192.7 million during fiscal 2024, 2023, and 2022, respectively.

Estimated future amortization expense as of October 1, 2023 ( in millions ):

Estimated future amortization expense as of September 29, 2024 ( in millions ):

Fiscal Year Ending

8 unchanged sentences

— 97.4 — — 97.4

Goodwill balance at October 1, 2023 $ 491.5 $ 2,691.1 $ 34.7 $ 1.0 $ 3,218.3

Goodwill balance at September 29, 2024

$ 491.5 $ 2,788.5 $ 34.7 $ 1.0 $ 3,315.7

(1) “Other” consists of changes in the goodwill balance resulting from foreign currency translation.

During the fiscal year ended October 1, 2023, we completed our annual goodwill impairment analysis.

During the fiscal year ended September 29, 2024, we completed our annual goodwill impairment analysis.

The results of our analysis indicated significant excess fair values over carrying values across the different reporting units, and therefore no goodwill impairment was recorded.

9 unchanged sentences

The 2021 credit facility contains provisions requiring us to maintain compliance with certain covenants, including a minimum fixed charge coverage ratio, which measures our ability to cover financing expenses.

As of October 1, 2023, we were in compliance with all applicable covenants.

No amounts were outstanding under our 2021 credit facility as of October 1, 2023 or October 2, 2022.

As of September 29, 2024, we were in compliance with all applicable covenants.

No amounts were outstanding under our 2021 credit facility as of September 29, 2024, or October 1, 2023.

Short-term Debt

2 unchanged sentences

The proceeds from borrowings under our commercial paper program may be used for working capital needs, capital expenditures, and other corporate purposes, including, but not limited to, business expansion, payment of cash dividends on our common stock, and share repurchases.

As of October 1, 2023, we had no borrowings outstanding under the program.

As of October 2, 2022, we had $ 175.0 million in borrowings outstanding under this program.

As of September 29, 2024, and October 1, 2023, we had no borrowings outstanding under the program.

Additionally, we hold the following Japanese yen-denominated credit facilities that are available for working capital needs and capital expenditures within our Japanese market:

• A ¥ 5 billion, or $33.5 million, credit facility is currently set to mature on January 4, 2024 .

• A ¥ 5.0 billion, or $34.5 million, credit facility is currently set to mature on December 30, 2024 .

Borrowings under this credit facility are subject to terms defined within the facility and will bear interest at a variable rate based on Tokyo Interbank Offered Rate (“TIBOR”) plus an applicable margin of 0.400 %.

1 unchanged sentence

Borrowings under this credit facility are subject to terms defined within the facility and will bear interest at a variable rate based on TIBOR plus an applicable margin of 0.300 %.

As of September 29, 2024, we had no borrowings outstanding under these credit facilities.

As of October 1, 2023, we had ¥ 5.0 billion, or $ 33.5 million, of borrowings outstanding under these credit facilities.

As of October 2, 2022, we had no borrowings outstanding under these credit facilities.

Long-term Debt

Components of long-term debt including the associated interest rates and related estimated fair values by calendar maturity ( in millions, except interest rates) :

Oct 1, 2023 Oct 2, 2022 Stated Interest Rate Effective Interest Rate (1)

Sep 29, 2024 Oct 1, 2023 Stated Interest Rate Effective Interest Rate (1)

Issuance Face Value Estimated Fair Value Face Value Estimated Fair Value

March 2023 notes $ — $ — $ 1,000.0 $ 996.5 3.100 % 3.107 %

October 2023 notes (2)

7 unchanged sentences

June 2026 notes 500.0 486.8 500.0 463.5 2.450 % 2.511 %

February 2027 notes

1,000.0 1,017.8 — — 4.850 % 4.958 %

March 2027 notes 500.0 477.1 500.0 446.1 2.000 % 2.058 %

6 unchanged sentences

February 2031 notes

500.0 520.8 — — 4.900 % 5.046 %

February 2032 notes 1,000.0 912.0 1,000.0 828.0 3.000 % 3.155 %

February 2033 notes 500.0 513.1 500.0 470.7 4.800 % 3.798 %

February 2034 notes

500.0 515.0 — — 5.000 % 5.127 %

June 2045 notes 350.0 308.5 350.0 275.3 4.300 % 4.348 %

12 unchanged sentences

Refer to Note 3 , Derivative Financial Instruments, for additional information on our interest rate swap designated as a fair value hedge.

(3) Floating rate notes which bear interest at a rate equal to Compounded SOFR (as defined in the February 2024 notes) plus 0.420 %, resulting in a stated interest rate of 5.853 % at October 1, 2023.

(3) Floating rate notes, which bear interest at a rate equal to Compounded SOFR (as defined in the February 2024 notes) plus 0.420 %, resulting in a stated interest rate of 5.848 % at maturity on February 14, 2024.

(4) Japanese yen-denominated long-term debt.

The following table summarizes our long-term debt maturities as of October 1, 2023 by fiscal year ( in millions ):

The following table summarizes our long-term debt maturities as of September 29, 2024, by fiscal year ( in millions ):

Fiscal Year Total

1 unchanged sentence

Total $ 15,700.0

In fiscal 2021, we substantially completed our plan to optimize our North America store portfolio, primarily in dense metropolitan markets by developing new store formats to better cater to changing customer tastes and preferences.

During the fiscal year ended October 3, 2021, we recognized accelerated amortization of ROU lease assets and other lease costs of $ 89.5 million, which were recognized within restructuring and impairments on the consolidated statements of earnings.

We did not recognize any material restructuring and impairment amounts related to this plan during the fiscal years ended October 1, 2023 and October 2, 2022.

The components of lease costs (in millions) :

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Operating lease costs (1)

5 unchanged sentences

The following table includes supplemental information (in millions) :

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Cash paid related to operating lease liabilities $ 1,672.5 $ 1,657.2 $ 1,647.3

1 unchanged sentence

2,263.9 1,893.4 1,639.4

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Weighted-average remaining operating lease term 8.6 years 8.5 years 8.5 years

1 unchanged sentence

Finance lease assets are recorded in property, plant and equipment, net with the corresponding lease liabilities included in accrued liabilities and other long-term liabilities on the consolidated balance sheet.

Finance leases were not material as of October 1, 2023, October 2, 2022 and October 3, 2021.

These balances were not material as of September 29, 2024, and October 1, 2023.

Finance lease costs were also immaterial for the fiscal years ending September 29, 2024, October 1, 2023, and October 2, 2022.

Minimum future maturities of operating lease liabilities (in millions) :

5 unchanged sentences

Total $ 10,234.7

As of October 1, 2023, we have entered into operating leases that have not yet commenced of $ 1.4 billion, primarily related to real estate leases.

As of September 29, 2024, we have entered into operating leases that have not yet commenced of $ 1.6 billion, primarily related to real estate leases.

These leases will commence between fiscal year 2025 and fiscal year 2028 with lease terms of 5 years to 20 years.

5 unchanged sentences

Therefore, a ratable recognition pattern is reflective of how we will satisfy our performance obligations.

As of October 1, 2023, the current and long-term deferred revenue related to the Nestlé up-front payment was $ 177.0 million and $ 6.0 billion, respectively.

As of September 29, 2024, the current and long-term deferred revenue related to the Nestlé up-front payment was $ 177.0 million and $ 5.8 billion, respectively.

As of October 1, 2023, the current and long-term deferred revenue related to the Nestlé up-front payment was $ 177.0 million and $ 6.0 billion, respectively.

During the fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021, we recognized $ 176.5 million, $ 176.5 million and $ 176.6 million of prepaid royalty revenue, respectively, related to Nestlé.

During each of the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022, we recognized $ 176.5 million of prepaid royalty revenue related to Nestlé.

Changes in our deferred revenue balance related to our stored value cards and loyalty program (in millions) :

Fiscal Year Ended October 1, 2023

Fiscal Year Ended September 29, 2024

Stored value cards and loyalty program at October 1, 2023

1 unchanged sentence

Revenue recognized - card and Stars redemptions and breakage ( 15,665.1 )

Stored value cards and loyalty program at October 1, 2023 (2)

Stored value cards and loyalty program at September 29, 2024 (2)

Fiscal Year Ended October 1, 2023

4 unchanged sentences

(1) “Other” primarily consists of changes in the stored value cards and loyalty program balances resulting from foreign currency translation.

(2) As of October 1, 2023, approximately $ 1.5 billion of this amount was current.

(2) As of September 29, 2024, approximately $ 1.6 billion of this amount was current.

As of October 1, 2023, approximately $ 1.5 billion of this amount was current .

In addition to 2.4 billion shares of authorized common stock with $ 0.001 par value per share, we have authorized 7.5 million shares of preferred stock, none of which was outstanding at October 1, 2023.

During the first quarter of fiscal 2022, we resumed our share repurchase program which was temporarily suspended in March 2020 upon the onset of the COVID-19 pandemic.

During the fiscal year ended October 2, 2022, we repurchased 36.3 million shares of common stock for $ 4.0 billion on the open market.

3 unchanged sentences

During the fiscal year ended October 1, 2023, we repurchased 10.0 million shares of common stock for $ 1.0 billion on the open market.

As of October 1, 2023, 42.6 million shares remained available for repurchase under current authorizations.

During the fiscal year ended September 29, 2024, we repurchased 12.8 million shares of common stock for $ 1.3 billion on the open market.

As of September 29, 2024, 29.8 million shares remained available for repurchase under current authorizations.

During the fourth quarter of fiscal 2024, our Board declared a quarterly cash dividend to shareholders of $ 0.61 per share to be paid on November 29, 2024, to shareholders of record as of the close of business on November 15, 2024.

2 unchanged sentences

Comprehensive income is comprised of net earnings and other comprehensive income.

Accumulated other comprehensive income reported on our consolidated balance sheets consists of foreign currency translation adjustments and other items and the unrealized gains and losses, net of applicable taxes, on available-for-sale debt securities and on derivative instruments designated and qualifying as cash flow and net investment hedges.

Changes in AOCI by component for the fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021, net of tax, are as follows:

Accumulated other comprehensive income reported on our consolidated balance sheets consists of foreign currency translation adjustments and

other items and the unrealized gains and losses, net of applicable taxes, on available-for-sale debt securities and on derivative instruments designated and qualifying as cash flow and net investment hedges.

Changes in AOCI by component for the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022, net of tax, are as follows:

(in millions) Available-for-Sale Securities Cash Flow Hedges Net Investment Hedges Translation Adjustment and Other Total

October 1, 2023

September 29, 2024

Net gains/(losses) in AOCI, beginning of period $ ( 12.3 ) $ ( 47.5 ) $ 243.3 $ ( 961.7 ) $ ( 778.2 )

10 unchanged sentences

Other comprehensive income/(loss) attributable to Starbucks 3.2 ( 246.5 ) 34.2 ( 105.2 ) ( 314.3 )

Other comprehensive income/(loss) attributable to NCI

— — — ( 0.7 ) ( 0.7 )

Net gains/(losses) in AOCI, end of period $ ( 12.3 ) $ ( 47.5 ) $ 243.3 $ ( 961.7 ) $ ( 778.2 )

9 unchanged sentences

the Statements of Earnings

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Gains/(losses) on available-for-sale securities $ ( 1.2 ) $ ( 0.7 ) $ ( 0.4 ) Interest income and other, net

Gains/(losses) on cash flow hedges 133.5 196.6 1.9 Please refer to Note 3 , Derivative Instruments for additional information.

Gains/(losses) on cash flow hedges ( 29.3 ) 133.5 196.6 Please refer to Note 3 , Derivative Financial Instruments, for additional information.

Gains/(losses) on net investment hedges 49.6 27.4 14.3 Interest expense

Translation adjustment and other (1)

Korea — — ( 58.9 ) Net gain resulting from divestiture of certain operations

Other ( 1.3 ) — — Interest income and other, net

0.1 ( 1.3 ) — Interest income and other, net

19.2 158.9 210.5 Total before tax

3 unchanged sentences

Employee Stock and Benefit Plans

We maintain several equity incentive plans under which we may grant non-qualified stock options, incentive stock options, restricted stock, restricted stock units (“RSUs”) or stock appreciation rights to employees, non-employee directors and consultants.

We maintain several equity incentive plans under which we may grant non-qualified stock options, incentive stock options, restricted stock, RSUs, or stock appreciation rights to employees, non-employee directors, and consultants.

We issue new shares of common stock upon exercise of stock options and the vesting of RSUs.

We also have an employee stock purchase plan (“ESPP”).

As of October 1, 2023, there were 92.6 million shares of common stock available for issuance pursuant to future equity-based compensation awards and 10.3 million shares available for issuance under our ESPP.

As of September 29, 2024, there were 83.2 million shares of common stock available for issuance pursuant to future equity-based compensation awards and 9.7 million shares available for issuance under our ESPP.

Stock-based compensation expense recognized in the consolidated financial statements (in millions) :

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

RSUs $ 308.3 $ 302.6 $ 271.8

5 unchanged sentences

Time-vested RSUs are awarded to eligible employees and entitle the grantee to receive shares of common stock at the end of a vesting period, subject to the employee’s continuing employment.

The time-vested RSUs generally either vest in two or four equal annual installments beginning a year from the grant date.

performance-based RSUs are awarded to eligible employees and entitle the grantee to receive shares of common stock if we achieve specified performance goals during the performance period and the grantee remains employed through the vesting period.

RSU transactions for the fiscal year ended October 1, 2023 (in millions, except per share and contractual life amounts) :

The time-vested RSUs generally vest in either two or four equal annual installments beginning a year from the grant date.

Our performance-based RSUs are awarded to eligible employees and entitle the grantee to receive shares of common stock if we achieve specified performance goals during the performance period and the grantee remains employed through the vesting period.

RSU transactions for the fiscal year ended September 29, 2024 (in millions, except per share and contractual life amounts) :

Shares Weighted

5 unchanged sentences

Forfeited/canceled ( 0.9 ) 101.65

Nonvested, October 1, 2023 7.3 99.56 1.0 670

As of October 1, 2023, total unrecogniz ed stock-based compensation expense related to nonvested RSUs, net of estimated forfeitures, was approximately $ 175 million , before income taxes, and is expected to be recognized over a weighted average period of approximately 2.1 years .

Nonvested, September 29, 2024 8.7 102.91 1.2 844

As of September 29, 2024, total unrecognized stock-based compensation expense related to nonvested RSUs, net of estimated forfeitures, was approximately $ 255 million, before income taxes, and is expected to be recognized over a weighted average period of approximately 2.3 years.

The total fair value of RSUs vested was $ 314 million, $ 292 million, and $ 298 million during fiscal 2024, 2023, and 2022, respectively.

6 unchanged sentences

All outstanding stock options are non-qualified stock options.

No stock options were granted during the fiscal years ended October 1, 2023 and October 2, 2022.

The fair value of stock option awards was estimated at the grant date with the following weighted average assumptions for fiscal 2021:

Stock Options

Granted During the Period

Fiscal Year Ended 2021

Expected term (in years) 8.1

Expected stock price volatility 26.3 %

Risk-free interest rate 1.4 %

Expected dividend yield 1.6 %

Weighted average grant price $ 110.46

Estimated fair value per option granted $ 27.59

The expected term of the options represents the estimated period of time until exercise and is based on historical experience of similar awards, giving consideration to the contractual terms, vesting schedules and expectations of future employee behavior.

Expected stock price volatility is based on a combination of historical volatility of our stock and the one-year implied volatility of Starbucks traded options, for the related vesting periods.

The risk-free interest rate is based on the implied yield available on U.S.

Treasury zero-coupon issues with an equivalent remaining term.

The dividend yield assumption is based on our anticipated cash dividend payouts.

The amounts shown above for the estimated fair value per option granted are before the estimated effect of forfeitures, which reduce the amount of expense recorded in the consolidated statements of earnings.

Stock option transactions for the fiscal year ended October 1, 2023 (in millions, except per share and contractual life amounts) :

No stock options were granted during the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022.

Stock option transactions for the fiscal year ended September 29, 2024 (in millions, except per share and contractual life amounts) :

Options Weighted

4 unchanged sentences

Expired/forfeited — 56.79

Outstanding, October 1, 2023 2.0 55.16 2.3 72

Exercisable, October 1, 2023 2.0 55.16 2.3 72

Vested, October 1, 2023 2.0 55.16 2.3 72

Outstanding, September 29, 2024 0.9 58.45 1.8 36

Exercisable, September 29, 2024 0.9 58.45 1.8 36

Vested, September 29, 2024 0.9 58.45 1.8 36

The aggregate intrinsic value in the table above, which is the amount by which the market value of the underlying stock exceeded the exercise price of outstanding options, is before applicable income taxes and represents the amount optionees would have realized if all in-the-money options had been exercised on the last business day of the period indicated.

As of October 1, 2023, all options outstanding were vested and exercisable.

No options vested during fiscal 2023.

The total fair value of options vested was $ 8 million and $ 14 million during fiscal 2022 and 2021, respectively.

As of September 29, 2024, all options outstanding were vested and exercisable.

No options vested during fiscal 2024 and 2023.

The total fair value of options vested was $ 8 million during fiscal 2022.

The total intrinsic value of options exercised was $ 44 million, $ 98 million, and $ 57 million during fiscal 2024, 2023, and 2022, respectively.

11 unchanged sentences

Components of earnings before income taxes (in millions):

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

United States $ 4,087.6 $ 4,488.6 $ 3,484.9

2 unchanged sentences

Provision/(benefit) for income taxes (in millions):

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Current taxes:

11 unchanged sentences

federal income tax rate with our effective income tax rate:

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Statutory rate 21.0 % 21.0 % 21.0 %

1 unchanged sentence

Foreign rate differential 0.3 0.4 0.3

Change in tax rates 0.0 0.0 ( 1.3 )

Other, net ( 0.3 ) ( 1.2 ) ( 2.2 )

Effective tax rate 24.3 % 23.6 % 22.4 %

As of October 1, 2023, in certain foreign subsidiaries in which we are partially indefinitely reinvested, the gross taxable temporary difference between the accounting basis and tax basis was approximately $ 2.5 billion for which there could be up to approximately $ 250 million of unrecognized tax liability.

As of September 29, 2024, in certain foreign subsidiaries in which we are partially indefinitely reinvested, the gross taxable temporary difference between the accounting basis and tax basis was approximately $ 2.6 billion for which there could be up to approximately $ 260 million of unrecognized tax liability.

Tax effect of temporary differences and carryforwards that comprise significant portions of deferred tax assets and liabilities (in millions):

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Deferred tax assets:

15 unchanged sentences

Net deferred tax asset (liability) $ 1,745.6 $ 1,755.2

The valuation allowances as of October 1, 2023 and October 2, 2022 were primarily related to net operating losses and other deferred tax assets of consolidated foreign subsidiaries.

As of October 1, 2023, we had federal net operating loss carryforwards of $ 70.8 million which have an indefinite carryforward period, federal tax credit carryforwards of $ 50.4 million which will begin to expire in fiscal 2030 and foreign net operating loss carryforwards of $ 434.8 million, of which $ 95.4 million have an indefinite carryforward period and the remainder will begin to expire in fiscal 2024.

The valuation allowances as of September 29, 2024, and October 1, 2023, were primarily related to net operating losses and other deferred tax assets of consolidated foreign subsidiaries.

As of September 29, 2024, we had federal net operating loss carryforwards of $ 76.8 million, which have an indefinite carryforward period, federal tax credit carryforwards of $ 69.0 million, which will begin to expire in fiscal 2030, and foreign net operating loss carryforwards of $ 434.8 million, of which $ 101.2 million have an indefinite carryforward period and the remainder will begin to expire in fiscal 2025.

Uncertain Tax Positions

As of October 1, 2023, we had $ 105.0 million of gross unrecognized tax benefits of which $ 72.8 million , if recognized, would affect our effective tax rate.

We recognized an expense of $ 5.7 million , an expense of $ 2.3 million and a benefit of $ 4.6 million of interest and penalties in income tax expense, prior to the benefit of the federal tax deduction, for fiscal 2023, 2022 and 2021, respectively.

As of October 1, 2023 and October 2, 2022, we had accrued interest and penalties of $ 15.1 million and $ 9.4 million, respectively, on our consolidated balance sheets.

As of September 29, 2024, we had $ 108.0 million of gross unrecognized tax benefits, of which $ 72.1 million, if recognized, would affect our effective tax rate.

We recognized expense of $ 8.8 million, $ 5.7 million, and $ 2.3 million of interest and penalties in income tax expense, prior to the benefit of the federal tax deduction, for fiscal 2024, 2023, and 2022, respectively.

As of September 29, 2024, and October 1, 2023, we had accrued interest and penalties of $ 22.5 million and $ 15.1 million, respectively, on our consolidated balance sheets.

The following table summarizes the activity related to our unrecognized tax benefits (in millions) :

Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Beginning balance $ 105.0 $ 89.7 $ 82.6

8 unchanged sentences

We are no longer subject to U.S.

federal examination for years prior to fiscal 2018, U.S.

state and local examinations for years prior to fiscal 2016 or examination in any material foreign markets prior to fiscal 2018.

federal, U.S.

state and local, or material foreign market examinations for years prior to fiscal 2018.

It is reasonably possible that up to approximately $ 58 million of the Company’s gross unrecognized tax benefits may be recognized by the end of fiscal 2025 for reasons such as a lapse of the statute of limitations or resolution of examinations with tax authorities.

1 unchanged sentence

Calculation of net earnings per common share (“EPS”) — basic and diluted (in millions, except EPS) :

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Net earnings attributable to Starbucks $ 3,760.9 $ 4,124.5 $ 3,281.6

5 unchanged sentences

Potential dilutive shares consist of the incremental common shares issuable upon the exercise of outstanding stock options (both vested and non-vested) and unvested RSUs, calculated using the treasury stock method.

The calculation of dilutive shares outstanding e xcludes anti-dilutive stock options or unvested RSUs, which were immaterial in the periods presented.

The calculation of dilutive shares outstanding excludes anti-dilutive stock options or unvested RSUs, which were immaterial in the periods presented.

Commitments and Contingencies

Legal Proceedings

Starbucks is involved in various legal proceedings arising in the ordinary course of business, including certain employment litigation cases that have been certified as class or collective actions, but is not currently a party to any legal proceeding that management believes could have a material adverse effect on our consolidated financial position, results of operations or cash flows.

Starbucks is involved in various legal proceedings arising in the ordinary course of business, including litigation matters associated with labor union organizing efforts and certain employment litigation cases that have been certified as class or collective actions, but is not currently a party to any legal proceeding that management believes could have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

While we are closely monitoring the operational and financial impacts of labor union organizing efforts on our business, as of the date of this filing, we believe the risk of a material contingent loss associated with these litigation matters is remote.

Segment Reporting

2 unchanged sentences

1) North America, which is inclusive of the U.S.

2) International, which is inclusive of China, Japan, Asia Pacific, Europe, Middle East and Africa, Latin America and the Caribbean;

2) International, which is inclusive of China, Japan, Asia Pacific, Europe, Middle East, Africa, Latin America, and the Caribbean;

and 3) Channel Development.

4 unchanged sentences

Consolidated revenue mix by product type (in millions):

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

$ 21,883.9 60 % $ 21,684.8 60 % $ 19,555.3 61 %

6 unchanged sentences

Information by geographic area ( in millions ):

Fiscal Year Ended Oct 1, 2023 Oct 2, 2022 Oct 3, 2021

Fiscal Year Ended Sep 29, 2024 Oct 1, 2023 Oct 2, 2022

Net revenues (1) :

3 unchanged sentences

Total $ 36,176.2 $ 35,975.6 $ 32,250.3

Oct 1, 2023 Oct 2, 2022

Sep 29, 2024 Oct 1, 2023

Long-lived assets:

3 unchanged sentences

Total $ 24,491.9 $ 22,142.1

(1) Includes Channel Development segment and other net revenues.

No customer accounts for 10% or more of our revenues .

5 unchanged sentences

Operating income represents earnings before other income and expenses and income taxes.

The identifiable assets by segment disclosed in this note are those assets specifically identifiable within each segment and include cash and cash equivalents, ROU assets, net property, plant and equipment, equity and cost investments, goodwill and other intangible assets.

Assets not attributed to reportable operating segments are corporate assets and are primarily comprised of cash and cash equivalents available for general corporate purposes, investments, assets of the corporate headquarters and roasting facilities and inventory.

The financial information below is presented for our reportable operating segments and Corporate and Other for the fiscal years ended October 1, 2023, October 2, 2022 and October 3, 2021 and as of October 1, 2023 and October 2, 2022.

The identifiable assets by segment disclosed in this note are those assets specifically identifiable within each segment and include cash and cash equivalents, ROU assets, net property, plant and equipment, equity method and other equity investments, goodwill, and other intangible assets.

The financial information below is presented for our reportable operating segments and Corporate and Other for the fiscal years ended September 29, 2024, October 1, 2023, and October 2, 2022, and as of September 29, 2024, and October 1, 2023.

( in millions )

16 unchanged sentences

Corporate and Other

Total assets at October 1, 2023

Total assets at September 29, 2024

$ 12,737.0 $ 8,464.5 $ 148.6 $ 9,989.2 $ 31,339.3

1 unchanged sentence

10,869.1 8,045.3 188.8 10,342.3 29,445.5

Subsequent Event

On October 14, 2024, we acquired 23.5 Degrees, a U.K.

licensed business partner, to expand our portfolio of company-operated stores and enhance the coffeehouse experience for customers.

The acquisition will convert 113 licensed stores to company-operated stores within our International operating segment.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

1 unchanged sentence

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Starbucks Corporation and subsidiaries (the “Company”) as of October 1, 2023 and October 2, 2022, the related consolidated statements of earnings, comprehensive income, equity, and cash flows, for each of the three years in the period en ded October 1, 2023 , and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of October 1, 2023 and October 2, 2022 , and the results of its operations and its cash flows for each of the three years in the period ended October 1, 2023 , in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of October 1, 2023 , based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 17, 2023, expresse d an unqualified opinion on the Company's internal control over financial reporting.

We have audited the accompanying consolidated balance sheets of Starbucks Corporation and subsidiaries (the “Company”) as of September 29, 2024, and October 1, 2023, the related consolidated statements of earnings, comprehensive income, equity, and cash flows, for each of the three years in the period en ded September 29, 2024 , and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 29, 2024, and October 1, 2023 , and the results of its operations and its cash flows for each of the three years in the period ended September 29, 2024 , in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of September 29, 2024 , based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated November 20, 2024, expresse d an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

12 unchanged sentences

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Income Taxes — Indefinite Reinvestment of Foreign Earnings - Refer to Note 14 to the financial statements

Goodwill Impairment Assessments for China Reporting Unit – Refer to Note 8 to the financial statements

Critical Audit Matter Description

Under the provisions of ASC 740, Income Taxes, (“ASC 740”), there is a presumption that investments in foreign subsidiaries will be recovered upon sale or through a partial or complete distribution of earnings to the parent entity, and therefore subject the parent entity to additional taxes.

If sufficient evidence shows the foreign subsidiary has invested or will invest the undistributed earnings indefinitely, the ASC 740 presumption may be overcome, and no additional taxes shall be accrued.

The Company has investments in the profitable operations of certain foreign subsidiaries that may be subject to additional foreign withholding taxes and/or U.S.

federal and state income taxes upon sale or a partial or complete distribution of earnings, incremental to local income taxes already paid.

As o f October 1, 2023 , th e Company is partially indefinitely reinvested in certain foreign subsidiaries.

The Company has recorded an immaterial deferred tax liability related to the taxable temporary difference for which it is not indefinitely reinvested.

For the remaining $2.5 billion of taxable temporary difference, there could be up to approximately $250 million of unrecognized tax liability.

The Company’s assertion of partial indefinite reinvestment for certain foreign subsidiaries requires management to make long-term forecasting assumptions and detailed plans for reinvestment.

The most significant assumption supporting the Company’s indefinite reinvestment assertion is the forecast of capital expenditures in international markets.

Performing audit procedures to evaluate the reasonableness of management’s indefinite reinvestment analysis and capital expenditures forecast required a high degree of auditor judgment and an increased extent of effort, including the need to involve our income tax specialists.

The Company ’ s goodwill for its China reporting unit within the international segment is tested annually for impairment during the third quarter of each year, and more frequently if events and circumstances indicate that the assets might be impaired.

The Company ’ s evaluation of goodwill for impairment involves comparing the estimated fair value of a reporting unit to its carrying value.

The estimated fair value of a reporting unit is determined using both income and market approaches, combined with an equal weighting.

The income approach is based on discounted future cash flows and requires significant assumptions, including estimates regarding future revenue and cash flow projections, and discount rates.

The market approach is based on comparable company multiples (revenue and “EBITDA,” which stands for earnings before interest, income taxes, depreciation, and amortization) and requires an estimate of multiples derived from comparable publicly traded companies to the reporting unit.

Changes in these estimates and assumptions could have a significant impact on either the fair value, the amount of any goodwill impairment charge, if any, or both.

The goodwill balance was $3,315.7 million as of September 29, 2024, of which $2,788.5 million was allocated to the international segment, inclusive of the China reporting unit.

The fair value of the China reporting unit was greater than its carrying value as of the measurement date, and as a result, management did not record an impairment charge related to the reporting unit goodwill.

We identified the goodwill impairment assessment of the China reporting unit as a critical audit matter because of the significant estimates and assumptions management made to determine the fair value.

The audit of these estimates and assumptions required a high degree of auditor judgment when performing audit procedures to evaluate the reasonableness of management ’ s estimates and assumptions related to revenue and cash flow projections, and the selection of significant valuation assumptions such as comparable company revenue and EBITDA multiples and discount rates.

The audit also required an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Matter Was Addressed in the Audit

Our principal audit procedures related to management’s indefinite reinvestment analysis and the supporting forecast of capital expenditures for certain foreign subsidiaries, included the following, among others:

• We tested the effectiveness of controls related to management’s forecast of capital expenditures.

• We performed a retrospective review of management’s historical ability to accurately forecast capital expenditures by comparing actual results to management’s historical forecast.

Our audit procedures related to revenue and cash flow projections and the selection of significant valuation assumptions, such as comparable company revenue and EBITDA multiples and discount rates, for the China reporting unit included the following:

• We tested the effectiveness of controls over management’s goodwill impairment evaluation, including the determination of the fair value of the China reporting unit, such as controls related to management ’ s forecasts and the selection of the discount rate and market multiples used.

• We inquired of senior executives of the Company to corroborate strategic plans for growth.

• We compared the forecasts obtained to support the indefinite reinvestment assertion to:

◦ Historical capital expenditures, including costs per new store opening;

◦ Historical new store growth;

◦ Historical profitability of new stores by region;

◦ Forecasts used by the Company for financial reporting purposes in other areas, such as the evaluation of the recoverability of goodwill;

◦ Internal communications to management and the Board of Directors;

◦ Forecasted information included in the Company’s press releases, other external communications and analyst reports;

◦ External publications of expected industry growth.

• With the assistance of our tax specialists, we evaluated the appropriateness of management’s analysis under ASC 740 and the sufficiency of the evidence provided by management to support that the Company has the intent and ability to partially indefinitely reinvest the undistributed earnings.

• We evaluated management ’ s ability to accurately forecast by comparing actual results to management ’ s historical forecasts.

• We performed a sensitivity analysis of the revenue growth rate, EBITDA margin, and discount rates, which included their impact on cash flows.

• We evaluated the reasonableness of management ’ s forecasts by comparing the forecasts to (1) historical results, (2) internal communications amongst management and the Board of Directors, (3) inquiry with personnel outside of finance and accounting, and (4) forecasted information included in analyst and industry reports relevant to the China reporting unit.

• With the assistance of our fair value specialists, we evaluated (1) the valuation methodologies used, (2) the comparable company multiples selected by management, and (3) the discount rate used in determining the present value of the expected cash flows.

• We considered the impact of trends in the industry and current macroeconomic factors on management ’ s forecasts.

/s/ Deloitte & Touche LLP

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data