Nike (NKE) chief executive officer (CEO) John Donahoe has announced that he’s retiring from the sneaker and athletic apparel maker effective Oct. 13.
Donahoe is being replaced by long-time veteran Elliott Hill, who is coming out of retirement to take the top role at Nike.
Donahoe, who has been Nike’s CEO since 2020, has been under pressure in recent months due to the poor performance of the company’s business and its stock. He will remain at Nike as an advisor through the end of January 2025.
Shares of Nike rose as much as 10% in after hours trading on news of Donahoe’s departure.
Donahoe has been blamed for a costly strategy misfire that saw Nike pivot to selling products directly to consumers rather than through third-party distributors, wholesalers, and retailers.
Analysts say Nike’s focus on developing its branded stores and website hurt the company’s innovation and reputation, and that the sneaker giant has lost ground to upstart rivals such as Deckers Outdoor (DECK).
In June of this year, when the company reported its latest financial results, Nike warned that it expected sales to drop 10% during the current third quarter.
Nike is in the midst of a restructuring plan that aims to reduce costs by $2 billion U.S. over the next three years, including eliminating 1,500 jobs.
In recent months, activist investor Bill Ackman has built a sizable position in Nike’s stock and has been pushing for change at the company.
Elliott Hill, who is coming out of retirement to take the CEO role, started his career at Nike as an intern in the 1980s.
He previously worked at Nike for 32 years, becoming president of the company’s consumer and marketplace division where he was responsible for all commercial and marketing operations.
Prior to today (Sept. 20), Nike’s stock had declined 24% this year and was trading at $80.98 U.S. per share.
