Starbucks has announced the sudden departure of CEO Laxman Narasimhan after just over a year in the role. Brian Niccol, currently chairman of Chipotle, will succeed him as chief executive in September. The leadership change follows mounting pressure from activist investor Elliott Investment Management, which has criticized Starbucks for declining sales in key markets, including the U.S., Canada, and China.
Starbucks shares surged by over 20% following the announcement, while Chipotle’s stock dropped 13%. Narasimhan, who joined Starbucks from PepsiCo in 2022, had succeeded company founder Howard Schultz. Despite stepping down from the board, Schultz has remained vocal about the company’s challenges, particularly criticizing U.S. operations.
Niccol, who transformed Chipotle with significant growth in revenue and profits since 2018, will now face the task of steering Starbucks through its current difficulties. Until his arrival, Starbucks CFO Rachel Ruggeri will serve as interim CEO.
Starbucks, founded in 1971, currently operates over 39,000 stores globally, including more than 1,000 in the UK, where it recently announced plans to expand further.
