McDonald's (MCD) is overhauling its leadership, as the world's largest restaurant chain struggles with slumping sales and profits.
The company announced late Wednesday that CEO Don Thompson will retire as president and CEO after less than three years at the helm. Steve Easterbrook, a senior executive vice president and head of McDonald's branding efforts, will succeed Thompson as of March 1.
"It's tough to say goodbye to the McFamily, but there is a time and season for everything," Thompson, a 25-year veteran of McDonald's, said in a statement. "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 suffered a string of disappointing financial results in recent years amid mounting health concerns about fast-food and the growing popularity of so-called fast-casual restaurants like Chipotle (CMG) and Panera (PNRA). Just last week, the company announced a 21 percent drop in profits, with revenue also sliding.
McDonald's shares, which fell 3 percent in 2014, rose $2.77 in after-hours trading to $91.55.
In his spell as CEO, Thompson has taken a number of steps aimed at energizing McDonald's growth. Those include introducing new menu items, moving to improve customer service and adding online ordering.
But none of these measures have done much to boost results, or convince investors that the executive has a plan for turning the company around.
Meanwhile, McDonald's has drawn fire from labor advocates for what they say is inadequate pay for workers, while other critics attack the company for marketing its products to children.
"On the heels of one of McDonald's worst years in history, Don Thompson's departure is yet another indication that this beleaguered brand is failing to adjust to the changing public climate" said Sriram Madhusoodanan of watchdog group Corporate Accountability International, in a statement. "Until it addresses the marketing, health, labor, supply chain and other concerns raised by investors and patrons alike, no amount of marketing or staff shakeups will right the course."