Starbucks replaces Laxman Narasimhan as CEO

Starbucks’ Indian American CEO Laxman Narasimhan is stepping down after a little more than a year in the job as the Seattle Coffee giant struggles with weak demand and disgruntled investors.

Brian Niccol, the chairman and CEO of Chipotle, will become Starbucks’ chairman and CEO on Sep 9, the company announced Tuesday.

Pune, India-born Narasimhan, a longtime PepsiCo executive who has also served as the CEO of Reckitt, a UK-based consumer health company, became Starbucks’ CEO in March 2023. He succeeded Howard Schultz, the longtime Starbucks leader and chairman emeritus who came out of retirement in 2022 to serve as the company’s interim CEO.

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But investors quickly soured on Narasimhan as the company’s sales weakened and it dealt with multiple issues, including competition from lower-cost competitors in China and boycotts in the Middle East and elsewhere due to its perceived support for Israel, according to an AP report.

“Laxman Narasimhan is stepping down from his role as ceo and as a member of the Starbucks board with immediate effect,” a company press release stated. “During his tenure, he improved the Starbucks partner experience, drove significant innovation in our supply chain, and enhanced our 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,” said Mellody Hobson, Starbucks board chair. “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.”

READ: Satya Nadella quits Starbucks board after 7 years (June 6, 2024)

Previously, Narasimhan held various leadership roles at PepsiCo, including as global chief commercial officer, where he was responsible for the company’s long-term strategy and digital capabilities.

He also served as CEO of the company’s Latin America, Europe and Sub-Saharan Africa operations, and previously as the CEO of PepsiCo Latin America, and the CFO of PepsiCo Americas Foods.

Prior to PepsiCo, Narasimhan was a senior partner at McKinsey & Company, where he focused on its consumer, retail and technology practices in the US, Asia and India and led the firm’s thinking on the future of retail.

Narasimhan is also a trustee of the Brookings Institution, a member of the Council on Foreign Relations, served as a member of the UK Prime Minister’s Build Back Better Council, and as a member of Verizon’s Board of Directors.

He holds a degree in Mechanical Engineering from the College of Engineering, University of Pune, India. He has an MA in German and International Studies from The Lauder Institute at The University of Pennsylvania and an MBA in Finance from The Wharton School of The University of Pennsylvania.