Nike Announces Its CEO Will Step Down Next Year

Well, we don’t say this too often, but: tough day to be a CEO at a global multi-billion-dollar sneaker company! Early this morning, Under Armour announced that its founder Kevin Plank will vacate his CEO role early next year. Now, just hours later, Nike is announcing that Mark Parker, whose held the CEO title since 2006, will leave the company in January 2020.

Questions around Parker’s tenure at Nike have swirled since early last year, when multiple executives left the company in light of a series of reports on the brand’s toxic internal culture. The New York Times reported that executives casually talked about keeping condoms on them or female coworkers’ bodies, and that, like at Under Armour, team outings sometimes ended at strip clubs. Nike also recently shut down its Oregon Project, a training group for the world’s very best runners, after its coach Alberto Salazar was banned from the sport for four years after violating anti-doping regulations. Parker was also turning 65, prompting questions about who would succeed him. Still, in March of last year, at the height of the internal conflict, the CEO announced he would remain with the Swoosh past 2020.

Instead, Nike announced late Tuesday that John Donahoe, who has served on Nike’s board since 2014, will become the company’s next CEO. Donahoe’s resume includes stints as the chairman of PayPal Holdings, the president and CEO of eBay, and the CEO of the consulting firm Bain & Co. Most recently, he was the CEO of ServiceNow.

“I am delighted John will join our team. His expertise in digital commerce, technology, global strategy and leadership combined with his strong relationship with the brand, make him ideally suited to accelerate our digital transformation and to build on the positive impact of our Consumer Direct Offense,” Parker said in a statement.

That statement, coupled with Donahoe’s previous experience in ecommerce, seems to hint that Nike wants to double down on the strategy that’s been so successful over the past couple of years. “Consumer Direct Offense” is Nike-talk for a strategy that, among other things, has revolved around relying less on outside retailers like Footlocker and instead focusing on sales through its own stores and website. Donahoe’s experience at eBay also sets off internal alarms considering the secondary market—where customers buy sneakers at retailers like StockX, Goat, and, yes, eBay—has exploded over the past few years. Even though these sales represent just a fraction of Nike’s revenue, it’s a sector where a lot of the excitement is and where many of the most-desired shoes end up. Nike has even tested the waters of the secondary market, partnering with StockX on a sort of sneaker IPO.

While Under Armour’s change might be chalked up to a desire to stop the bleeding, Nike’s comes as it looks to continue its momentum and rising revenues. Nike’s stock is trading close to its all-time high, and according to WSJ, has hardly been affected by the news in after-hours trading. “This is an exciting time for Nike where we see brand strength and momentum throughout the world and great opportunity for future growth,” Parker said.

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