Deb Hall Lefevre, the Chief Technology Officer of coffee chain Starbucks (SBUX), has resigned, and the company has not yet named a permanent replacement, according to a memo seen by Reuters. The memo, written by Chief Financial Officer Cathy Smith, said that Ningyu Chen, who was Senior Vice President of Global Experience Technology, will step in as interim CTO. It is worth noting that Lefevre, a former McDonald’s (MCD) executive who was hired in 2022 to improve drive-through and mobile ordering systems, plans to retire.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 55% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Her exit comes as Starbucks is carrying out another round of corporate job cuts under CEO Brian Niccol, who is working to revive the company after six straight quarters of declining sales. Interestingly, the plan relies heavily on new technology, such as an AI-powered inventory system, a digital assistant for baristas, an upgraded point-of-sale system, and a queuing tool to help during rush hours. Despite Lefevre’s departure, the memo said that the company’s technology priorities remain unchanged and are central to the “Back to Starbucks” turnaround strategy.
Separately, Starbucks announced it will close several hundred underperforming U.S. stores by the end of fiscal 2025, which will reduce its store count in the U.S. and Canada by about 1%. The company will also eliminate 900 non-retail jobs. At the same time, Reuters said that India’s Tata Consultancy Services (IN:TCS) is taking on a larger role in Starbucks’ tech division. However, Starbucks stressed that it will continue to keep a strong in-house technology team.
Is SBUX Stock a Good Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on SBUX stock based on 14 Buys, six Holds, and two Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SBUX price target of $102.10 per share implies 22.8% upside potential.
