Starbucks Freezes Buybacks As Schultz Returns

Starbucks Corp. said it is suspending billions of dollars in share repurchases, a move that interim Chief Executive Officer (CEO) Howard Schultz said would free up cash to invest in cafes and employees, Heather Haddon reported for Wall Street Journal (WSJ).

Photo Insert: Starbucks interim CEO Howard Schultz

Pausing the buyback program, which Starbucks initiated last fall, represents the best way for the company to invest in its next phase of growth, Schultz told employees in a letter coinciding with his return Monday as the coffee giant’s CEO.

Starbucks trails only McDonald’s as the largest restaurant chain by market capitalization. Its mobile app has also secured a loyal customer base and become a business priority.

Schultz will also have his hands full steering a coffee chain that has seen its workers voting to unionize to bargain for better deals from a management not exactly pleased with paying higher wages and better benefits for personnel.

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