8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 13, 2022

Starbucks Corporation

(Exact name of registrant as specified in its charter)

Washington	000-20322	91-1325671
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2401 Utah Avenue South, Seattle, Washington 98134

(Address of principal executive offices) (Zip Code)

(206) 447-1575

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.001 per share	SBUX	Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Selection 13(a) of the Exchange Act. ☐

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On March 13, 2022, Kevin R. Johnson notified the board of directors (the “board”) of Starbucks Corporation (“Starbucks”) of his decision to retire as president and chief executive officer and as a member of the board, effective April 4, 2022. Following such date, Mr. Johnson will continue to provide executive transition services until the end of fiscal year 2022, and his base salary and annual bonus opportunity will be reduced by 50%, effective June 1, 2022.

In order to facilitate an orderly transition in connection with Mr. Johnson’s departure, on March 15, 2022, the board appointed Starbucks founder and former president and chief executive officer, Howard Schultz, as interim president and chief executive officer and as a member of the board, effective April 4, 2022.

Mr. Schultz, 68, previously served as chairman of the board of directors of Starbucks since its inception in 1985 and until June 2018. He also previously served as chief executive officer from January 2008 to April 2017 and from November 1985 to June 2000, and as president from January 2008 until March 2015 and from November 1985 to June 1994. From June 2000 to February 2005, Mr. Schultz also held the title of chief global strategist. Mr. Schultz also held leadership and director roles with Giornale Coffee Company and Starbucks Coffee Company, which were predecessors to Starbucks.

The selection of Mr. Schultz to serve as interim president and chief executive officer was not pursuant to any arrangement or understanding with respect to any other person. There are no family relationships between Mr. Schultz and any director or executive officer of Starbucks.

Mr. Schultz will receive a base salary of $1 and will be entitled to participate in Starbucks’ benefit plans on the same basis as similarly situated partners. Mr. Schultz will not receive any other compensation or benefits related to his service as interim president and chief executive officer and as a member of the board.

Starbucks and entities owned by Mr. Schultz previously entered into a management services agreement and a hangar space lease for Mr. Schultz’s aircraft. Pursuant to the management services agreement, an entity owned by Mr. Schultz operates his aircraft using services provided by Starbucks and pays Starbucks fees for such services, the amounts of which were set at market rates. Under the terms of the hangar space lease, an entity owned by Mr. Schultz pays Starbucks rent based on its pro-rata portion of the maintenance, utilities and other expenses paid by Starbucks for the hangar. It is anticipated that for fiscal year 2022, Mr. Schultz’s entities will pay Starbucks approximately $6.9 million in fees and approximately $700,000 in rent.

Item 7.01 Regulation FD Disclosure.

A copy of the press release announcing the retirement of Mr. Johnson and the appointment of Mr. Schultz as interim president and chief executive officer and as a member of the board is attached hereto as Exhibit 99.1. The information included in this Current Report on Form 8-K under this Item 7.01 (including Exhibit 99.1) shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing made by Starbucks under the Exchange Act or the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Press Release dated March 16, 2022
104	Cover Page Interactive Data File (formatted as inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	STARBUCKS CORPORATION
Dated: March 16, 2022
	By:	/s/ Rachel A. Gonzalez
		Rachel A. Gonzalez
		executive vice president, general counsel

EX-99.1

Exhibit 99.1

Attorney Client Privilege – for scenario planning purposes only

Starbucks Announces Leadership Transition

Starbucks president and chief executive officer, Kevin Johnson, retiring after 13 years of service

Search for ceo successor underway, led by Starbucks Board of Directors

Howard Schultz to return as interim ceo until new leader joins

SEATTLE (March 16, 2022) – Business Wire – Starbucks Corporation (NASDAQ: SBUX) announced that Kevin Johnson, president and chief executive officer, intends to retire after a 13-year tenure at the company, including the last five years as ceo. Johnson will transition from his current role on April 4, 2022, and will continue to serve as a Starbucks partner (employee) and special consultant to the company and Board of Directors through September. The Starbucks Board of Directors has been engaged in continuous ceo succession planning, assisted by Russell Reynolds Associates since 2021, and anticipates selecting a new leader by the Fall. To ensure seamless stewardship of the company until a permanent successor is named, the Board has appointed Howard Schultz as interim chief executive officer, effective April 4, 2022. Schultz will also rejoin the company’s Board of Directors.

“On behalf of the entire Board, I want to express our sincerest thanks to Kevin for his leadership of Starbucks. Kevin and the entire executive team stepped up to the challenge of the pandemic and navigated one of the most difficult periods in modern history. The economic certainty provided to partners during the early months of the COVID shut down, as well as during mandatory quarantines, underscores our core values and will be an enduring legacy for the company. During Kevin’s tenure, Starbucks scaled an industry leading digital offering spanning nearly 45 million Starbucks Rewards members in the U.S. and China,” said Mellody Hobson, Independent Starbucks Board of Directors chair.

Johnson, who has served on the Starbucks Board of Directors since 2009, joined the Starbucks leadership team in 2015 as president and chief operating officer. In 2017, Johnson was named president and chief executive officer, succeeding founder Schultz.

Building on the rich heritage of the company, Johnson established the People Positive, Planet Positive and Profit Positive framework that seeks to create a better world for Starbucks partners, farmers, customers and the communities it serves. He expanded the company’s reach through the Global Coffee Alliance with Nestlé, which now operates in nearly 80 markets, and established and executed the Growth at Scale agenda that significantly increased shareholder value.

“A year ago, I signaled to the Board that as the global pandemic neared an end, I would be considering retirement from Starbucks. I feel this is a natural bookend to my 13 years with the company. As I make this transition, we are very fortunate to have a founder who is able to step in on an interim basis, giving the Board time to further explore potential candidates and make the right long-term succession decision for the company,” said Kevin Johnson. “I have enjoyed every minute of the job and am proud of what we have achieved together. It has been an honor to serve the 400,000 Starbucks green apron partners around the world and I want to thank them for their service, resilience and optimism.”

Hobson and Johnson will provide an update to shareholders during the 2022 Starbucks Annual Meeting of Shareholders webcast later today. The Board of Directors has formed a working committee to oversee the ceo search process which is ongoing and yielding a strong slate of potential candidates.

As the company’s founder and architect of its culture, the Board of Directors believes Schultz is singularly qualified to serve as interim ceo until a new leader has been identified. In addition to the day-to-day management of the company, Schultz will participate in the search process and help onboard the next ceo.

“For 50 years, Starbucks has been relentlessly focused on exceeding the expectations of our people and our customers, while delivering best-in-class financial performance,” said Hobson. “As the company navigates the aftermath of the pandemic and socio-economic forces impacting the lives of all our stakeholders, Howard will reinforce the company’s culture, underscoring the organization’s commitment to innovating and executing on our core purpose and reason for being: to inspire and nurture the human spirit—one person, one cup and one neighborhood at a time.”

Schultz built Starbucks into one of the world’s most recognized and respected businesses, a company committed to strengthening communities through human connection and innovation. Under his leadership from 1987 to 2018, Starbucks grew from 11 stores with 100 partners to more than 28,000 stores in 77 countries. As ceo, he redefined the role and responsibility of a publicly held company, pioneering programs like comprehensive healthcare, stock ownership and free college tuition for full and part-time employees. During Schultz’s tenure, Starbucks stock price gained 21,000% from the time of its initial public offering in 1992 until he stepped down as executive chairman in 2018.

“When you love something, you have a deep sense of responsibility to help when called. Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new and exciting future where all of our stakeholders mutually flourish,” said Schultz.

As interim ceo, Schultz will focus on setting an innovation framework, while also coaching and onboarding the next permanent ceo of Starbucks. “Our success is not an entitlement. We must continue to earn the trust of our people and our customers every day by how we deliver the Starbucks Experience, how we treat each other and how we act as a responsible community member and corporate citizen. With the backdrop of COVID recovery and global unrest, its critical we set the table for a courageous reimagining and reinvention of the future Starbucks experience for our partners and customers,” commented Schultz.

Schultz is volunteering his time as interim ceo to Starbucks and will receive $1 of compensation.

About Starbucks

Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and roasting high-quality arabica coffee. Today, with more than 34,000 stores worldwide, the company is the premier roaster and retailer of specialty coffee in the world. Through our unwavering commitment to excellence and our guiding principles, we bring the unique Starbucks Experience to life for every customer through every cup. To share in the experience, please visit us in our stores or online at stories.starbucks.com or www.starbucks.com.

Forward-Looking Statements

Certain statements contained herein are “forward-looking” statements within the meaning of the applicable securities laws and regulations. Generally, these statements can be identified by the use of words such as “aim,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “feel,” “forecast,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “will,” “would,” and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These statements include statements relating to trends in or expectations relating to the effects of our existing and any future initiatives, strategies and plans, as well as trends in or expectations regarding our financial results and long-term growth model and drivers, the anticipated timing and effects of recovery of our business, the conversion of several market operations to fully licensed models, our plans for streamlining our operations, including store openings, closures and changes in store formats and models, expanding our licensing to Nestlé of our consumer packaged goods and Foodservice businesses and its effects on our Channel Development segment results, tax rates, business opportunities and expansion, strategic acquisitions, our future relationship with Starbucks Coffee Korea Co., Ltd., expenses, dividends, share repurchases, commodity costs and our mitigation strategies, liquidity, cash flow from operations, use of cash and cash requirements, investments, borrowing capacity and use of proceeds, continuing compliance with our covenants under our credit facilities and commercial paper program, repatriation of cash to the U.S., the likelihood of the issuance of additional debt and the applicable interest rate, the continuing impact of the COVID-19 pandemic on our financial results, future availability of governmental subsidies for COVID-19 or other public health events, the expected effects of new accounting pronouncements and the estimated impact of changes in U.S. tax law, including on tax rates, investments funded by these changes and potential outcomes and effects of legal proceedings. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties. Actual future results and trends may differ materially depending on a variety of factors, including, but not limited to: further spread of COVID-19 and related disruptions to our business; regulatory measures or voluntary actions that may be put in place to limit the spread of COVID-19, including restrictions on business operations or social distancing requirements, and the duration and efficacy of such restrictions; the potential for a resurgence of COVID-19 infections and the circulation of novel variants of COVID-19 in a given geographic region after it has hit its “peak”; fluctuations in U.S. and international economies and currencies; our ability to preserve, grow and leverage our brands; the ability of our business partners and third-party providers to fulfill their responsibilities and commitments; potential negative effects of incidents involving food or beverage-borne illnesses, tampering, adulteration, contamination or mislabeling; potential negative effects of material breaches of our information technology systems to the extent we experience a material breach; material failures of our information technology systems; costs associated with, and the successful execution of, the Company’s initiatives and plans, including the successful expansion of our Global Coffee Alliance with Nestlé; our ability to obtain financing on acceptable terms; the acceptance of the Company’s products by our customers, evolving consumer preferences and tastes and changes in consumer spending behavior; partner investments, changes in the availability and cost of labor including any union organizing efforts and our responses to such efforts; significant increased logistics costs; inflationary pressures; the impact of competition; inherent risks of operating a global business; the prices and availability of coffee, dairy and other raw materials; the effect of legal proceedings; and the effects of changes in tax laws and related guidance and regulations that may be implemented and other risks detailed in the company filings with the Securities and Exchange Commission, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. The company assumes no obligation to update any of these forward-looking statements.

XML

Document and Entity Information	Mar. 13, 2022
Cover [Abstract]
Entity Registrant Name	STARBUCKS CORP
Amendment Flag	false
Entity Central Index Key	0000829224
Document Type	8-K
Document Period End Date	Mar. 13, 2022
Entity Incorporation State Country Code	WA
Entity File Number	000-20322
Entity Tax Identification Number	91-1325671
Entity Address, Address Line One	2401 Utah Avenue South
Entity Address, City or Town	Seattle
Entity Address, State or Province	WA
Entity Address, Postal Zip Code	98134
City Area Code	(206)
Local Phone Number	447-1575
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, par value $0.001 per share
Trading Symbol	SBUX
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false