McDonald's Corporation CEO Donald Thompson will step down at the end of February, the fast-food giant announced Wednesday, after the company suffered one of its worst financial years in decades.
Thompson will be replaced by Stephen Easterbrook, the company's chief brand officer. The CEO's ouster comes after the company endured months of declining sales. The company recently posted extremely poor fourth-quarter results, with a 21 percent drop in earnings and declines in store traffic of 3.6 percent globally and 4.1 percent in the U.S., according to USA Today.
"I don't think it was too much of a surprise. Maybe in the timing, but not the action," Sara Senatore, an analyst at Sanford Bernstein, told Reuters. "This has been something that people have been talking about for a while."
Shares in the world's largest restaurant chain jumped as much as 3.5 percent to $91.90 in late trading after the announcement. Bloomberg reported that the company has not grown in the U.S. since October 2013.
“It’s tough to say goodbye to the McFamily, but there is a time and season for everything,” Thompson said, after market hours, in a press release cited by The Guardian. “I am truly confident, as I pass the reins over to Steve, that he will continue to move our business and brand forward.”
McDonald's has faced a myriad of issues in recent years, from consumer tastes evolving toward healthier fare to controversies about the pay and conditions of staff, and the ethics of marketing strategies that seemingly target children.
The company has announced significant changes in a bid to win back consumers, including a simplified menu that aims to make it easier for diners to quickly decide what they want while streamlining kitchen operations, and examining the ingredients it uses, which critics have taken significant issue with. For example, the company attracted criticism for revelations that its french fries contain 19 ingredients, including an “anti-foaming agent,” according to the Washington Post.
Bill Smead, CEO and chief investment officer of Smead Capital Management, a long-term McDonald's shareholder with about 180,000 shares, told CNBC: “Trying to please everybody is one of the issues that they're dealing with," adding that he would like to see the company take more risks and focus on what consumers want.