Starbucks introduces its next CEO

  • 3 weeks ago
TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and Starbucks’ new CEO.
Transcript
00:00I'm Conway Gittins reporting from the New York Stock Exchange. Here's what we're watching on the
00:03street today. Wall Street is taking comfort in the latest inflation readings. July producer prices
00:08rose just 0.1 percent, which was less than expected. Over the past 12 months, wholesale
00:14inflation is up 2.2 percent. Meanwhile, Home Depot topped second quarter sales and profit forecasts.
00:20However, the number of transactions per customer fell for the 13th straight quarter,
00:26and the company is forecasting weaker sales for the rest of 2024. In other news,
00:32there's a big shakeup at the top of Starbucks. CEO Laxman Narasimhan is out effective immediately,
00:39and Brian Nichol, the head of Chipotle, is in. The board issued a statement saying,
00:44quote, Brian is a culture carrier who brings a wealth of experience and a proven track record
00:50of driving innovation and growth. Our board believes he will be a transformative leader
00:54for our company, our people, and everyone we serve around the world. Nichol has his work cut
01:00out for him. Starbucks is in a slump, with customers complaining about high prices and
01:04long wait times. He's also struggled to switch to a post-pandemic world that favors mobile takeout
01:10and quick drive-through over sitting down and lounging around in a coffee shop. He's also
01:16inheriting a stock that's lost one-fifth of its value over the past five years, and a struggle
01:21with activist investor Elliott Investment Management. There's also growing tension
01:25between the company and its workers. Employees have been fighting to unionize. Former CEO and
01:31major investor Howard Schultz weighed in on the subject in May on LinkedIn, saying Starbucks had
01:36lost its way and needed to patch things up with workers. Nichol comes to Starbucks after a star
01:42run at Chipotle under his tenure of more than five years. Sales grew roughly 800 percent.
01:50That'll do it for your daily briefing from the New York Stock Exchange.
01:52I'm Conway Gittens with The Street.

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