(Reuters) - Starbucks Corp <SBUX.O> on Thursday said Howard Schultz will step down as chief executive to focus on its high-end coffee shops as Chief Operating Officer Kevin Johnson takes over as CEO.
Starbucks signaled the change in July, saying that Schultz was moving away from day-to-day operations to focus on the development of high-end stores and long-term growth.
But the announcement on Thursday comes as investors worry that growth at the company is cooling from its red-hot levels. Starbucks shares were down 3.9 percent at $56.25 in after-market trading on Thursday.
See photos of Howard Schultz:
Starbucks executive chairman Howard Schultz
Starbucks executive chairman Howard Schultz
Starbucks Chairman and CEO Howard Schultz appears on the Fox Business Network's Opening Bell with Maria Bartiromo television program in New York City, November 6, 2014. REUTERS/Mike Segar (UNITED STATES - Tags: BUSINESS FOOD)
Howard Schultz, chief executive of Starbucks, poses for a portrait at his new Teavana store in New York, October 23, 2013. Starbucks Corp, which has doubled down on its tea bet, is opening its first Teavana tea bar in New York City this week, aiming to do for tea, the world's second most popular beverage after water, what it has done for coffee. REUTERS/Carlo Allegri (UNITED STATES - Tags: BUSINESS FOOD)
Starbucks Corp Chief Executive Howard Schultz, pictured with images from the company's new "Race Together" project behind him, speaks during the company's annual shareholder's meeting in Seattle, Washington March 18, 2015. Schultz has deftly navigated thorny issues such as gay marriage, gun control and Congressional gridlock, but his move to weigh in on U.S. race relations has brewed up a social media backlash. The company kicked off the discussion when it published full-page ads in major U.S. newspapers earlier this week with the words "Shall We Overcome?" at center page and "RaceTogether" and the Starbucks logo near the bottom. REUTERS/David Ryder (UNITED STATES - Tags: BUSINESS)
Starbucks Chief Executive Howard Schultz speaks during the company's annual shareholder's meeting in Seattle, Washington March 18, 2015. Starbucks Corp will begin offering delivery in New York City and Seattle later this year, when it also plans to expand mobile order and pay services across the United States. REUTERS/David Ryder (UNITED STATES - Tags: BUSINESS)
Howard Schultz, Chairman and CEO of Starbucks, attends a dinner reception for Chinese President Xi Jinping in Seattle, Washington September 22, 2015. Xi landed in Seattle on Tuesday to kick off a week-long U.S. visit that will include meetings with U.S. business leaders, a black-tie state dinner at the White House hosted by President Barack Obama and an address at the United Nations. REUTERS/Jason Redmond
Howard Schultz CEO of Starbucks poses during an interview with Reuters in Shanghai April 19, 2012. Starbucks Corp wants to make its mainland China expansion a family affair. The world's biggest coffee chain is opening cafes in China at a rate of one every four days in its quest to expand from about 570 shops today to more than 1,500 by 2015. REUTERS/Carlos Barria (CHINA - Tags: BUSINESS COMMODITIES)
Starbucks CEO Howard Schultz speaks to shareholders about the company's partnership with the Keurig single-serve coffee brewing machine, at the company's annual meeting of shareholders in Seattle, Washington March 23, 2011. REUTERS/Robert Sorbo (UNITED STATES - Tags: BUSINESS)
Starbucks Chief Executive Howard Schultz talks to shareholders at the Starbucks Annual Shareholders meeting at McCaw Hall in Seattle, Washington March 19, 2008. REUTERS/Marcus R. Donner (UNITED STATES)
Starbucks Chief Executive Howard Schultz speaks during an interview in Tokyo April 13, 2010. Starbucks plans to sell its Via brand instant coffee in grocery stores and other retail channels outside its own outlets in Japan in the future, Schultz said. To match interview STARBUCKS/JAPAN REUTERS/Yuriko Nakao (JAPAN - Tags: BUSINESS HEADSHOT)
Howard Schultz, the President of Starbucks Coffee Company takes a sip of coffee as he assists in the opening of his first coffee house in Paris, January 15, 2004. The coffee house is situated on Avenue de l'Opera at the heart of Paris' tourist district. REUTERS/Charles Platiau PP04010041 MAL/WS
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Schultz has been the shareholders' darling at the Seattle-based company. When he returned in 2008 for his second stint as CEO, the stock was trading below $10. Late last year it hit an all-time high above $60.
Johnson is a former technology executive who became president and chief operating officer atStarbucks in March 2015. He will take over as CEO of the company on April 3, 2017, Starbuckssaid in a statement.
Johnson has been on the Starbucks board since 2009 but most of his career was in the technology industry.
"Not having retail experience could be a problem over time," said Howard Penney, an analyst at Hedgeye Risk Management.
On a conference after the announcement, analysts pressed the company on timing and whether, with Schultz stepping aside, senior management still had the "merchant" gene.
"I'm not leaving the company and I'm here every day," said Schultz, adding that he will be focused on building a new franchise within Starbucks.
Store traffic at established stores fell in the last quarter, which Johnson has attributed to a change in the company's loyalty program, and Starbucks forecast a mid-single-digit rise in 2017 same-store sales.
The move increases the focus of the well-regarded Schultz on Starbucks establishing itself at the high end of coffee shops.
"Howard Schultz ... will shift his focus to innovation, design and development of StarbucksReserve Roasteries around the world, expansion of the Starbucks Reserve retail store format and the company's social impact initiatives," the company said.