02:48 PM EDT, 10/21/2025 (MT Newswires) -- Starbucks' ( SBUX ) fiscal Q4 results are expected to show pressured margins and earnings as sales trends continue to lag amid industry headwinds, and limited progress on "Back to Starbucks ( SBUX )" strategic initiatives, UBS Securities said in a Tuesday note.

Investors are expecting flat to modestly down US same-store sales in fiscal Q4, compared with the consensus of a 0.2% fall, UBS said, adding that a key focus during the company's earnings call will be on the US sales trajectory, with initiatives like Green Apron service mode currently in place.

UBS said it is modelling fiscal Q4 operating margins of 10.3%, versus consensus of 10.5%, due to pressures stemming from sales deleverage and incremental labor and marketing investments. UBS expects recent investment in labor hours and the rollout of the Green Apron service model to impact margins near term.

Starbucks' ( SBUX ) ongoing coffee house remodel program is expected to help improve customer experience and support sales growth over the longer term, UBS said, as it estimates North America same-store sales of 3% for fiscal 2026.

UBS maintained its neutral rating on Starbucks' ( SBUX ) stock and cut its price target to $94 from $100.

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