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Kevin Johnson and Howard Schultz. (Starbucks Photo)
Kevin Johnson and Howard Schultz. (Starbucks Photo)

BREAKING NEWS: Longtime Starbucks CEO Howard Schultz will be stepping down as the coffee giant’s top leader in April 2017, handing over the reins to Kevin Johnson, the current Starbucks president, who worked at Microsoft and other tech companies prior to joining Starbucks as an executive last year.

Schultz will remain involved with Starbucks as executive chairman, focusing on strategic initiatives including Starbucks Reserve Roasteries and retail stores, and social issues. Schultz has been increasingly outspoken on challenges facing the country, including race relations and education. He said last year that he wasn’t interested in seeking political office, including U.S. president, but that was before Hillary Clinton lost the 2016 race to Republican Donald Trump.

Starbucks foreshadowed this change back in July, when it announced plans for Schultz to shift his focus to long-term projects, with Johnson running the coffee giant’s core business and leadership team.

Johnson has been a member of the Starbucks board since 2009 prior to becoming an executive at the company last year. As a former Microsoft Windows president and Juniper Networks CEO, his tech experience promises to be an asset as Starbucks increasingly pursues digital initiatives such as smartphone ordering and mobile coffee delivery.

On a conference call with analysts discussing the change in leadership, Schultz said he personally asked Johnson to succeed him as CEO, saying Johnson has been his “partner in running every facet of Starbucks’ business day-to-day over the last two years.”

During the company’s quarterly earning conference call last month, Schultz spoke extensively about the future of the Starbucks brand and innovation that will keep it ahead of competitors.

The desire to bring the unique Roastery experience to a wider audience is part of Starbucks’ long-range strategy. The Reserve Roastery and Tasting Room that opened in Seattle in 2014 is a jewel for the company and eventual plans call for 20 or 30 worldwide as well as smaller-scale locations playing off that fancier coffee-house theme.

“For those of you who have seen Seattle, I’ll tell you that Shanghai and New York will be 2.0,” Schultz said of the next Roastery locations. “As good as Seattle is, wait ’til you see what we’re going to do in New York and Shanghai. It’s going to change the company, the brand and everything we do.”

Developing story, more to come. Here is the company’s news release.

SEATTLE (Dec. 1, 2016) – Starbucks Corporation (NASDAQ: SBUX) today announced that Kevin Johnson, president and chief operating officer and a 7-year member of the Starbucks Board of Directors, will expand his responsibilities and assume the role and responsibilities of president and chief executive officer, effective April 3, 2017.

Also effective April 3, 2017, Howard Schultz, chairman and ceo, will be appointed executive chairman and will shift his focus to innovation, design and development of Starbucks Reserve® Roasteries around the world, expansion of the Starbucks Reserve® retail store format and the company’s social impact initiatives. In this new role Schultz will continue to serve as chairman of the Board.

“Starbucks consistently outperforms the retail industry because our stores, our offerings and the experiences our partners create make us a destination. The best evidence of the success of the core strategy driving our business is that we continue to deliver quarter after quarter of record, industry leading revenue, comp sales and profit growth, and that the newest classes of Starbucks stores continue to deliver record-breaking revenues, AUV’s and ROI both in the U.S. and around the world,” said Schultz. “As I focus on Starbucks next wave of retail innovation, I am delighted that Kevin Johnson – our current president, coo, a seven-year board member and my partner in running every facet of Starbucks business over the last two years – has agreed to assume the duties of Starbucks chief executive officer. This move ideally positions Starbucks to continue profitably growing our core business around the world into the future.”

As president and chief operating officer since March 2015, Johnson has led the company’s global operating businesses across all geographies as well as the core support functions of Starbucks supply chain, marketing, human resources, technology, and mobile and digital platforms. Johnson has been a Starbucks board member since 2009, and will continue to serve as a member of the Board.

“Over the past two decades, I have grown to know Starbucks first as a customer, then as a director on the board, and for the past two years as a member of the management team. Through that journey, I fell in love with Starbucks and I share Howard’s commitment to our mission and values and his optimism for the future,” said Johnson. “It is an honor for me to serve the more than 300,000 partners who proudly wear the green apron and I consider it a privilege to work side-by-side with Howard, our world-class board of directors, and a very talented leadership team. Together, we will reaffirm our leadership in all things coffee, enhance the partner experience and exceed the expectations of our customers and shareholders. We believe in using our scale for good and having positive social impact in the communities we serve around the world.”

Johnson’s career spans 33 years in the technology industry which included a 16-year career at Microsoft and a five-year tour as CEO of Juniper Networks. At Microsoft, he led worldwide sales and marketing and became the president of the Platforms Division. In 2008, he was appointed to the National Security Telecommunication Advisory Committee where he served Presidents George W. Bush and Barack Obama. He joined the Starbucks board in 2009 and the management team in 2015.

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