Starbucks CEO Change Shakes Up Chipotle

Starbucks is making some big changes at the top, as its CEO Laxman Narasimhan plans to step down to take on a new role at Chipotle. This news sent Starbucks’ stock tumbling more than 10% on Tuesday.

Brian Niccol, who has been leading Chipotle since March 2018, will be leaving his position. Under Niccol’s leadership, Chipotle’s stock soared by more than 770%. Now, the board has named Scott Boatwright, the current Chief Operating Officer, as the interim CEO.

Adding to the transition, Jack Hartung, who is the Chief Financial Officer, was expected to retire but has decided to stay on for the time being to help the company through this leadership change. Mellody Hobson, the board chair at Starbucks, remarked on Niccol’s capabilities, saying he knows what to do through various market cycles.

While many restaurants are struggling lately, Chipotle has been enjoying strong same-store sales growth, with a recent revenue report showing $2.97 billion and an 18.2% rise in net sales. Same-store sales even jumped by 11.1% during the last quarter.

Niccol navigated Chipotle through some tough times, including a foodborne illness crisis and the challenges posed by the pandemic. Before his time at Chipotle, he also served as the CEO of Taco Bell.

Analyst Mark Kalinowski has a mixed view on Niccol’s exit, suggesting that while it may seem negative for Chipotle now, there might be room for fresh ideas in the long run.