Starbucks Restaurants Replaces CEO Laxman Narasimhan With Chipotle CEO Brian Niccol
CNBC (left) | Getty Images (right)
Starbucks announced on Tuesday the replacement of CEO Laxman Narasimhan by Chipotle CEO Brian Niccol.
Starbucks shares rose 10% in premarket trading on the news, while Chipotle shares fell 10%.
Narasimhan took over as CEO in March 2023. The coffee giant’s performance has struggled this year, hurt by weak sales in the United States and China, its two largest markets. Former CEO Howard Schultz, who handpicked Narasimhan as his successor, wrote an open letter in May, outlining the company’s problems and offering advice, but never mentioning Narasimhan by name. Activist investor Elliott Management bought a stake in the company in recent weeks.
Starbucks shares have fallen 21% since Narasimhan began his term, excluding Tuesday’s decision.
Narasimhan’s departure is effective immediately. Starbucks CFO Rachel Ruggeri will serve as interim CFO until September 9, when Niccol officially begins his new role.
Niccol has been CEO of Chipotle since 2018. Prior to that, he led Yum Brands Taco Bell. As CEO of Chipotle, he helped the chain recover from the foodborne illness scandal and led its restaurants through the pandemic. In recent quarters, as other restaurants reported sharp declines in consumer spending, Chipotle saw traffic and sales surge, bucking the trend.
Chipotle COO Scott Boatwright will serve as interim CEO of the burrito chain. Chipotle CFO Jack Hartung, who had planned to retire next year, will continue in his role as president of strategy, finance and supply chain.
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