Starbucks Corp.’s new CEO, Brian Niccol, is set to receive an astounding compensation package exceeding $113 million. This lucrative offer includes a $10 million sign-on bonus, a $75 million equity grant, and a potential annual grant worth $23 million starting in fiscal 2025. In addition to this impressive financial package, Niccol will have the privilege of working remotely from his Newport Beach, California residence. He will receive a $1.6 million annual salary and a performance-based cash bonus ranging from $3.6 million to $7.2 million, as detailed in the company’s SEC filing and Niccol’s offer letter. While Niccol is not required to relocate to Starbucks’ headquarters in Seattle, he has agreed to commute when necessary. Until he finds permanent secondary housing in Seattle, Starbucks will cover the cost of any temporary housing arrangements and provide a personal chauffeur. The company has also pledged to establish a small remote office in Newport Beach to accommodate Niccol. This move by Starbucks reflects their confidence in Niccol’s leadership, citing his impressive track record at Chipotle Mexican Grill. Under Niccol’s leadership, Chipotle’s stock price soared by 800%, and profits increased nearly sevenfold. Niccol is replacing the departing CEO, Laxman Narasimhan, whose 17-month tenure saw a 23.9% decline in Starbucks’ share price. The appointment of Niccol has generated significant interest and debate within the restaurant industry. Analysts widely view this as a win for Starbucks, given Niccol’s success in boosting Chipotle’s stock price. CNBC’s ‘Mad Money’ host, Jim Cramer, believes Niccol holds the key to reviving Starbucks, which has faced challenges in key markets like the U.S. and China. Cramer, however, cautioned that the turnaround will not be immediate. The market reacted swiftly to the leadership change. Chipotle’s stock dropped by nearly 10% on Tuesday, resulting in a $7 billion loss in market value, while Starbucks’ shares surged over 20%, adding more than $15 billion to its valuation. The market is clearly optimistic about Niccol’s ability to lead Starbucks toward a brighter future.
