Starbucks shares spiked 20% Tuesday after the company hired away Chipotle chief executive Brian Niccol to take over as CEO, a bold move by the coffee giant as it contends with flagging sales and activist investors calling for change. Niccol led a major turnaround at Chipotle after taking the reins in March 2018, overseeing a 770% increase in the company’s stock price during his tenure. As of Tuesday afternoon, Chipotle shares plunged over 7% on the news.
Niccol’s embattled predecessor, Laxman Narasimhan, was the handpicked successor to three-time CEO Howard Schultz, but he faced several challenges, including increased price competition and economic headwinds in China. His standing suffered a major blow when Schultz, now chairman emeritus, publicly criticized the company’s management in May.
