Niccol will also be earning an annual salary of $1.6 million, with the possibility of up to $7.2 million in cash, and possible annual equity awards of $23 million
Joanna Fantozzi
Starbucks has offered incoming CEO Brian Niccol a cash signing bonus of $10 million and a replacement equity grant with a target value of $75 million (60% of which is based on performance and 40% of which is stock based), according to a new filing with the U.S. Securities and Exchange Commission.
This is just what Niccol was offered to make up for the stock options he leaves behind at Chipotle Mexican Grill, where last year, he made a base salary of $1.3 million, and received total compensation of $22.5 million in stock options and bonuses. In 2023, the ratio of Niccol’s salary to an average Chipotle hourly employee was $1,354 to $1.
Now, in making the monumental move from heading one multibillion-dollar foodservice brand to another, Niccol will be earning an annual salary at Starbucks of $1.6 million, with an annual cash incentive opportunity of up to $7.2 million, and the eligibility to receive annual equity rewards of $23 million.
“Brian Niccol has proven himself to be one of the most effective leaders in our industry, generating significant financial returns over many years,” Starbucks said in a statement received by CNBC News. “His compensation at Starbucks is tied directly to the company’s performance and the shared success of all our stakeholders. We’re confident in his ability to deliver long-term, enduring value for our partners, customers and shareholders.”
When Niccol officially joins Starbucks as CEO on Sept. 9, he will inherit several challenges in attempting to right the course at the Seattle-based coffee chain. At the top of the list is communicating Starbucks’ value to price-conscious consumers. Analysts have criticized the company’s about-face under Laxman Narasimhan’s leadership, where he introduced value meal deals for the first time in Starbucks history. The challenge will be repairing Starbucks’ reputation as a premium brand, while also appealing to customers that are spending more on coffee at home these days.
Additionally, Niccol inherits a digital infrastructure in need of repairs or overhauling, operational hurdles for baristas, and a tense relationship with Starbucks’ growing union.
However, as NRN reported when Niccol was first announced as CEO this week, he brings to Starbucks a history of driving traffic — both at his time at Chipotle and at Taco Bell — as well as improving operational efficiencies on the front line, as evidenced by his Project Square One initiative to get back to basics at Chipotle.
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