Starbucks CEO Orin Smith to Retire in 2005

Starbucks Corp. (SBUX) Tuesday said its chief executive, Orin Smith (search), will retire effective March 31 of next year.

The head of Starbucks' North American unit, Jim Donald, 50, will replace Smith, 62, as the coffee shop chain's president and CEO.

Smith joined Starbucks in 1990 and took over the CEO post from Chairman Howard Schultz (search), 51, in June of 2000. Smith has served in a string of management roles throughout his 14-year tenure with the chain, including chief operating officer.

Schultz, who is credited with transforming a small Seattle chain into a coffee shop empire, relinquished the CEO title to devote more time to worldwide expansion and brand development.

Also on Tuesday, Starbucks said it promoted its executive vice president of U.S. business and operations, Jim Alling, to the new post of president of Starbucks Coffee U.S.

Starbucks shares fell 74 cents to $47.30 in after-hours trade on INET (search) from their close of $48.04 on Nasdaq.