Starbucks Corp. Chairman Howard Schultz will leave the coffee chain later this month, bringing to a close a nearly four-decade run at the company that ushered coffeehouse culture into mainstream American life and carved out a global restaurant empire to rival McDonald’s.
Schultz, 64, who helped grow Starbucks from 11 stores to more than 28,000 in 77 countries, will become chairman emeritus on June 26. Myron Ullman will take over as the new head of the board, the company said in a statement.
His exit will likely fuel speculation he could be gearing up for a U.S. presidential bid. In a letter to employees announcing his exit, he said that he is “thinking about a range of options for myself, from philanthropy to public service, but I’m a long way from knowing what the future holds.”
Schultz’s announcement was calculated to make a big splash. He gave an extended interview to the New York Times in advance, with an interview on CNBC scheduled for Tuesday morning. If Schultz decides to make a bid for the presidency, he could lean on the experience of one of a longtime board member, the former presidential candidate and ex-Senator Bill Bradley.
‘Deeply concerned’
“For some time now, I have been deeply concerned about our country -- the growing division at home and our standing in the world,” he told the New York Times in an interview. He said he wants to figure out “if there’s a role I can play in giving back.”
Schultz is leaving a Starbucks that is still growing in the U.S. -- but not at the spectacular rates of the past. The company, now one of the world’s largest restaurant chains, is betting big on China, where it plans to more than triple revenue in the next five years. But investors have been underwhelmed by the company’s new outlook, with the shares falling about 11 percent in the last year.
Schultz, whose net worth is estimated at $3.2 billion, has had less day-to-day involvement since he stepped down as CEO, and near-term, the company’s strategy is unlikely to change, said Brian Yarbrough, an analyst at Edward Jones. Still, the stock may be more volatile, especially around earnings results, as investors worry the company will struggle without its visionary founder, Yarbrough said.
“At some point, there becomes a time when you have to have faith in your current management team going forward,” Yarbrough said. “The management team is very capable, I don’t have a lot of concerns.”
Anti-bias training
The coffee chain also recently faced backlash after two black men were arrested at one of its Philadelphia cafes while waiting for a meeting to start. The chain closed about 8,000 company-owned stores for an afternoon of anti-bias training last week, a decision that some shareholders questioned for the expense.
Last April, Schultz transitioned from chief executive officer to executive chairman, where he oversaw the company’s social impact initiatives. He also was working on growing the chain’s premium Reserve brand that includes flagship roastery locations, as well as the partnership with Italian bakery Princi. His top lieutenant Kevin Johnson took over the CEO role last year.
New chairman Ullman is a retail executive, who left the helm of J.C. Penney Co. in 2015 after stints at LVMH Moet Hennessy Louis Vuitton SA and what’s now Macy’s Inc.
Schultz will be spending more time with his family this summer, as well as working on a book about the chain’s social impact, the company said.
Shares fell as much as 2.8 percent in late trading after the announcement. The stock has declined 0.6 percent this year through Monday’s close.