Starbucks announced Tuesday it has named Chipotle leader Brian Niccol as its CEO and chairman, a shocking move as the coffee chain battles a tough sales environment and works with an activist hedge fund.
Laxman Narasimhan, who joined as incoming CEO in October 2022 and officially became CEO in 2023, is stepping down immediately as CEO and as a member of the board.
Niccol’s role will begin September 9. Until then, CFO Rachel Ruggeri will serve as interim CEO. Board chair Mellody Hobson will become lead independent director.
“I am excited to join Starbucks and grateful for the opportunity to help steward this incredible company, alongside hundreds of thousands of devoted partners,” Niccol said in a statement. “I have long-admired Starbucks iconic brand, unique culture and commitment to enhancing human connections around the globe. As I embark upon this journey, I am energized by the tremendous potential to drive growth and further enhance the Starbucks experience for our customers and partners, while staying true to our mission and values.”
Niccol has worked as Chipotle’s CEO since 2018. Under his tenure, the fast casual’s revenue has nearly doubled, profits have increased sevenfold, and the stock price has increased by almost 800 percent. Additionally, the brand worked to increase wages and expand benefits for employees. Before joining Chipotle, he worked as CEO of Taco Bell, chief marketing and innovation officer, and president. Niccol also served in leadership roles at Pizza Hut.
Niccol will remain Chipotle’s CEO until August 31. COO Scott Boatwright, who joined the company in 2017, will serve as interim CEO. The executive has played a major role in driving operations for over 120,000 employees and 3,500 stores and led the integration of key technology inside restaurants.
CFO Jack Hartung, who recently announced his retirement from Chipotle in 2025, agreed to remain with the organization indefinitely as president of strategy, finance and supply chain. In this new role, he will support Boatwright and continue his current oversight of incoming CFO Adam Rymer, as well as global head of supply chain Carlos Londono.
Chipotle lead independent director Scott Maw was named chairman of the board effective immediately.
“Thanks to our robust talent planning process, we are well-prepared for events like this due to the deep bench within the organization,” Maw said in a statement. “The board is excited to see other strong leaders expand their roles and provide growth and development for more people in the organization.”
Niccol currently serves on the board of directors of Walmart Inc. He previously served on the board of KB Home and Harley-Davidson. The restaurateur holds an undergraduate degree from Miami University and an MBA from the University of Chicago Booth School of Business.
Starbucks founder Howard Schultz said he’s long admired Niccol’s leadership style.
“His retail excellence and track record in delivering extraordinary shareholder value recognizes the critical human element it takes to lead a culture and values driven enterprise,” Schultz said in a statement. “I believe he is the leader Starbucks needs at a pivotal moment in its history. He has my respect and full support. I thank Mellody and the Starbucks board for their deep commitment to shaping the future of this remarkable global phenomenon that is Starbucks.”
The coffee brand has struggled to reach customers amid a tougher macroeconomic environment.
The brand’s stateside transactions plunged 7 percent in Q2 as same-store sales declined 3 percent. It marked the worst performance outside of the pandemic or Great Recession and a sharp departure from post-COVID trends—traffic figures were healthy as recently as October. That red line continued in Q3, the three-month period that ended June 30, with Starbucks’ U.S. same-store sales falling 2 percent, comprised of a 6 percent traffic slide and 4 percent growth in average ticket (the same number as Q2).
Also in July, Elliott Investment Management, an activist hedge fund, reportedly acquired a significant stake in Starbucks and is pressuring the company to boost its stock price. Potential changes being discussed include slowing down unit growth, particularly in China, reallocating capital, selling or spinning off the China business, and accelerating the implementation of Starbucks’ Siren System.
Despite the recent performances, Starbucks praised Narasimhan’s efforts in driving innovation in the supply chain and building store operations.
“On behalf of the board, I want to sincerely thank Laxman for his contributions to Starbucks, and his dedication to our people and brand,” Hobson said in a statement. “In the face of some challenging headwinds, Laxman has been laser focused on improving the business to meet the needs of our customers and partners. We all wish him the very best and know he will do great things in the future.”
