It’s a case of “meet the new boss, same as the old boss” at Starbucks Corp. (SBUX).
The coffee retailer announced CEO Kevin Johnson will be retiring April 4 and replaced by company founder and former longtime CEO Howard Schultz on an interim basis. Johnson joined the Starbucks board in 2009, became president and COO in 2015, and replaced Schultz in 2017.
The company said as founder and architect of its culture, Schultz is “singularly qualified” to lead Starbucks as it navigates the aftermath of the COVID-19 pandemic and socioeconomic forces impacting all its stakeholders. Schultz will also assist in the search for a new CEO.
Third Term as CEO
Schultz was CEO twice before, first from 1986 to 2000 and then again from 2008 to 2017. He is credited with turning the company from a small, 11-store operation into an international powerhouse, now with 28,000 locations in 77 countries and an annual revenue in 2021 of $24.6 billion.
Schultz explained he didn’t plan to return, but felt a responsibility to help transform Starbucks once again to “meet a new and exciting future.”
The news is sending shares of Starbucks up 6%.
Brighter Skies for Airlines
Airline companies say skies are looking blue, as several of the biggest U.S. carriers raised their revenue forecasts as more consumers are looking to fly.
United Airlines Holdings Inc. (UAL) reported that demand for travel following the peak of the omicron variant of COVID-19 in January exceeded its previous expectations. It now anticipates first quarter total operating revenue to be near or better than its previous guidance of 20% to 25% below that of the first quarter of 2019.
Southwest Airlines Co. (LUV) also said it’s seeing “improvement in revenue trends” this month as cases of the virus decrease. The company expects operating income in the current quarter to be 8% to 10% lower than two years ago. That’s up from its earlier estimate of a drop of 10% to 15%.
Offsetting Fuel Costs
American Airlines Group Inc. (AAL) changed its quarterly revenue guidance from a decline of 20% to 22%, to approximately 17% below 2019 levels. American expects the jump in sales to more than offset fuel and other expenses.
Delta Air Lines Inc. (DAL) predicted first quarter revenue to be 78% of that of 2019. In January it said sales could be as low as 72%. As with American, Delta believes the gains will be greater than the higher costs it will face for fuel.
JetBlue Airways Corp. (JBLU) noted its current quarter sales will be down 6% to 9% from two years ago, as opposed to its earlier estimate of a 11% to 16% decline.
Also helping boost airline shares was the 7% drop in oil prices.
The Dow Jones U.S. Airlines Total Stock Market Index is surging again today after yesterday’s big gain.