Longtime Starbucks leader Howard Schultz — who returned to the company as interim CEO on Monday — said his first major action will be suspending Starbucks’ share buyback program and plowing those billions of dollars into the company instead.
“This decision will allow us to invest more profit into our people and our stores — the only way to create long-term value for all stakeholders,” Schultz said in an open letter to employees posted on Starbucks’ website.
The pivot in strategy comes just three weeks after Starbucks announced that Schultz, who bought the company in 1987 and led it for more than three decades, would be taking over the company’s top role until it finds a permanent CEO. Previous CEO Kevin Johnson announced his retirement on March 16; the company said it expects to name a permanent CEO by this fall.
Starbucks announced late last year that it was committing to a three-year, $20 billion share repurchase and dividend program to return profits to investors. That was on top of a $25 billion share buyback and dividend program the company announced in 2018.