CoffeeNetwork (New York) - The first wave of 2025 and early‑2026 earnings calls has delivered one of the clearest windows yet into how the world is drinking coffee—and what that means for cafés, CPG giants, and investors in the year ahead. Across markets and company types, a consistent story emerges: consumers still want coffee, but they want it on their terms—value‑forward, cold‑leaning, increasingly functional, and split between premium experiences and convenience‑driven formats.
The strongest universal signal across the quarter comes from transaction‑led same‑store sales growth. At Starbucks, Q1 FY26 global comps rose 4%, driven overwhelmingly by +3% transactions and only +1% ticket—a result duplicated in the U.S. and echoed in its international markets. China posted an impressive +7% comp, again powered by higher footfall, not higher spending.
In other words: people are returning for coffee, but they are shopping with caution. Promotional sensitivity is up; loyalty engagement is critical; and product innovation, particularly in beverages beyond the traditional hot latte, is becoming a defining growth engine.
Meanwhile, Starbucks’ Channel Development business—which includes grocery and ready‑to‑drink—grew 19%, reinforcing that RTD remains one of the strongest supplemental consumption channels outside cafés.
No market illustrates the duality of coffee consumption quite like China. Luckin Coffee ended 2025 with 31,048 stores, a staggering 39% year‑over‑year unit increase, while monthly transacting customers hit 98.4 million in Q4 (+26.5%). But same‑store sales told a softer story: just +1.2% for the quarter.
This underscores the reality of China’s coffee boom: demand is exploding, but brands are buying growth through density and price. Luckin’s model—high‑frequency, low‑ticket, and hyper‑convenient—contrasts sharply with Starbucks’ more premium approach, which still logged +7% comps in China thanks to transaction gains.
The competitive takeaway is unmistakable: China is no longer a one‑brand story, and its next 50 million coffee drinkers will likely be won through price strategy, delivery speed, and smaller‑format innovation.
After three years of pandemic‑era elevation, at‑home coffee consumption appears to be stabilizing. Keurig Dr Pepper’s U.S. Coffee segment saw Q4 revenue up 3.9%, almost entirely due to ~8% price, even as pod shipments declined 2.8% and brewer shipments dropped 16.8%. Operating income contracted under the weight of coffee cost inflation.
The company expects continued cost pressures and retailer inventory adjustments into the first half of 2026.
Perhaps the clearest picture of consumer pushback comes from JDE Peet’s. The company’s FY2025 organic sales climbed 15.3%, but that figure masks an important split: 19.5% price vs. −4.3% volume/mix globally. In Europe—the company’s largest region—the decline was even sharper at −7.9% as retailers resisted price hikes and consumers traded down.
Despite strong cost control and product innovation, the numbers reveal a European shopper who is deeply price‑sensitive and willing to switch formats, brands, or retailers to maintain affordability. Private label and discount channels are major winners.
Something remarkable is happening across chains: cold beverages are not just a trend—they are the backbone of traffic growth.
At Tim Hortons, Q4 cold beverages surged 8.6%, reaching a record 27% mix of beverage sales.
At Dutch Bros, Q4 system same‑shop transactions climbed 5.4%, underpinning a 29% revenue jump—fueled by a menu built almost entirely around cold, indulgent, and energy‑adjacent drinks.
And McDonald’s, seeing the same opportunity, is preparing to roll out a new McCafé beverage line nationwide—including energy drinks, refreshers, and crafted sodas—after a 500‑store test “exceeded expectations.” Executives peg the global beverage opportunity at $100 billion.
Taken together, these signals point to a consumption pattern increasingly defined by all‑day beverages, not just morning coffee. Younger consumers, in particular, are treating coffee shops like beverage hubs—not strictly caffeine stops.
In the CPG world, coffee’s importance hasn’t diminished. Nestlé used its FY2025 results to single out coffee—alongside pet care and nutrition—as one of its three global “powerhouse” categories.
Separate industry reporting highlighted Nestlé’s coffee portfolio (Nescafé, Nespresso, and Starbucks‑licensed products) as a key contributor to its 7.3% organic growth in Powdered & Liquid Beverages. The company is leaning heavily into cold‑ready formats like Nescafé Iced Blend and café‑style concentrates—products tailor‑made for younger at‑home iced coffee drinkers.
The message is clear: coffee remains one of the most resilient, innovation‑rich consumer categories in the global grocery system.
Even with healthy demand, many companies emphasized the drag of elevated green coffee prices, tariffs, and logistics inflation. Starbucks cited these directly as contributors to compressed margins in its Q1 FY26 report.
However, a potential turning point may be on the horizon. Analysts are forecasting a record 2026/27 Brazil crop, which could ease global supply pressures and, ultimately, help normalize pricing after several tight years.
If this plays out, brands may gain the flexibility to rebalance their price/promotion mix later in the year—an especially critical lever in markets like Europe where volume losses have become acute.
Coffee consumption in 2026 isn’t declining—it’s transforming. Consumers are drinking more often, across more formats, with more intent, and with tighter value discipline than ever before. Chains are building beverage empires. Grocery aisles are shifting under the weight of pricing power. And global markets—from China to Europe—highlight how dramatically coffee behavior can diverge by region.
Alexis Rubinstein
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