STARBUCKS CORPSBUX

STARBUCKS CORP Revenue Disclosure

10-KFiled Nov 14, 20252 min read
Deferred Revenue
During fiscal 2018, we licensed the rights to sell and market our products in authorized channels through the Global Coffee Alliance and received an up-front prepaid royalty from Nestlé. The up-front payment of approximately $7 billion was recorded as deferred revenue as we have continuing performance obligations to support the Global Coffee Alliance, including providing Nestlé access to certain intellectual properties and products for future resale. The up-front payment is being recognized as other revenue on a straight-line basis over the estimated economic life of the arrangement of 40 years for the ongoing access to the licenses within the contractual territories. Our obligations to maintain the Starbucks brand and other intellectual properties are generally constant throughout the term of the arrangement. Therefore, a ratable recognition pattern is reflective of how we will satisfy our performance obligations.
As of September 28, 2025, the current and long-term deferred revenue related to the Nestlé up-front payment was $177.0 million and $5.6 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. During each of the fiscal years ended September 28, 2025, September 29, 2024, and October 1, 2023, 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 September 28, 2025
Total
Stored value cards and loyalty program at September 29, 2024
$1,718.7 
Revenue deferred - card activations, card reloads and Stars earned15,245.8 
Revenue recognized - card and Stars redemptions and breakage(15,199.5)
Other(1)
(13.3)
Stored value cards and loyalty program at September 28, 2025(2)
$1,751.7 
Fiscal Year Ended September 29, 2024
Total
Stored value cards and loyalty program at October 1, 2023
$1,567.5 
Revenue deferred - card activations, card reloads and Stars earned15,807.1 
Revenue recognized - card and Stars redemptions and breakage(15,665.1)
Other(1)
9.2 
Stored value cards and loyalty program at September 29, 2024(2)
$1,718.7 
(1)“Other” primarily consists of changes in the stored value cards and loyalty program balances resulting from foreign currency translation.
(2)As of each of the fiscal years ended September 28, 2025, and September 29, 2024, approximately $1.6 billion of the respective amounts was current.
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Historical Timeline

Fiscal YearFiled
2025Nov 14, 2025Showing above
2024Nov 20, 2024
2023Nov 17, 2023
2022Nov 18, 2022
2021Nov 19, 2021
2020Nov 12, 2020

About Revenue Disclosures

Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.

Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.

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