Chipotle stock fell as much as 10% on Tuesday as the company announced CEO Brian Niccol would be leaving his role. Brian Niccol departure from Chipotle on Aug 31 is to become CEO of Starbucks. Amid the executive shake-up, Chipotle CFO Jack Hartung, who had announced plans to retire in 2025, has agreed to remain with Chipotle “indefinitely” as a president of strategy, finance, and supply chain.
Niccol has been the CEO of Chipotle since 2018. Chipotle’s board named Chief Operating Officer Scott Boatwright as interim CEO. He has been at the company since 2017. The board also announced that Chief Financial Officer Jack Hartung, who had announced his intention to retire, would stay with the company indefinitely and assist with the transition.
Brian Niccol’s departure, Chipotle’s loss
Chipotle stock has risen more than 770% since he took over.
Niccol has been integral to Chipotle’s rebound over the past several years as the company recovered from an E. coli crisis that began in 2015 and weighed on shares for years. In the year before Niccol joined the company, Chipotle’s annual revenues were around $4.5 billion; by 2023, revenue had more than doubled, totaling $9.9 billion for the year. In the past five years, the stock has rallied more than 240% against an 85% gain for the S&P 500.
Chipotle’s sales
Chipotle has seen strong same-store sales growth and traffic while other restaurants have reported that consumers are pulling back on customer spending.
Chipotle reported Q2 earnings in July that topped analyst estimates, with $2.97 billion in revenue. Net sales climbed 18.2% during the quarter, with same-store sales up 11.1%.
Impact of Brian Niccol’s departure
Niccol helped lead Chipotle through a foodborne illness scandal and oversaw the chain of restaurants during the pandemic.
Before taking over at Chipotle, Niccol was CEO at Yum Brands’ Taco Bell.
Analyst Mark Kalinowski, chief executive of Kalinowski Equity Research, struck a cautious tone on the CEO change.
“While this will be viewed as bad for Chipotle in the short term, Mr. Niccol had been CEO there 6+ years, so perhaps the opportunity to bring some new thinking to that highly-respected company isn’t the worst thing in the world for the long run,” Kalinowski wrote in a note Tuesday.
Chipotle stock update
Chipotle share price has seen a tremendous rise of over 770% since Niccol took over. Chipotle share price was down 7% at closing for the day. Chipotle stock price was $51.68 today.
