NKE Nike Inc

By Khadeeja Safdar 

Nike Inc. said longtime Chief Executive Mark Parker will step aside as CEO of the sportswear giant and be replaced by one of the company's current board members.

Mr. Parker, who took over as CEO in 2006, will step aside on Jan. 13, 2020, and be replaced by John Donahoe, a former eBay Inc. CEO who is a Nike director. Mr. Parker will become Nike's executive chairman.

The executive shuffle comes at a time that Nike's sneaker and apparel business has been logging strong sales, but the brand has also faced a series of public relations crises, including the recent ban of Nike's top running coach amid doping allegations and concerns about the company's workplace culture.

Last year, Mr. Parker apologized for allowing a corporate culture that excluded some staff and failed to take seriously complaints about workplace issues. The apology followed weeks of turmoil and the departures of several senior executives, including Mr. Parker's top lieutenant.

The Wall Street Journal had earlier reported that Nike was investigating allegations of inappropriate behavior after a group of women at the company had circulated a survey that reached Mr. Parker.

Earlier this month, the Journal reported that Nike-backed running coach Alberto Salazar on numerous occasions briefed Mr. Parker on his experiments using testosterone cream for track and field athletes, according to emails revealed by the U.S. Anti-Doping Agency.

Mr. Parker, in an email to Nike staff, described news accounts as "highly misleading" and underscored his support for Mr. Salazar. A spokesman for Nike said Mr. Salazar was concerned Nike runners could be sabotaged by people rubbing the cream on them.

Mr. Parker's tenure has been a financial success: Sales have more than doubled and Nike's share price has steadily climbed giving the company a market value of roughly $150 billion. Nike dwarfs its competitors, with almost twice as much revenue as main rival Adidas AG.

The company has been posting strong sales in recent quarters both in the U.S. and China, its two biggest markets. The growth has been helped by Nike's shift to sell more of its products directly to consumers and via its own shopping apps.

Nike shares, which are trading near all-time highs, were little changed in after-hours trading after ending Tuesday's regular session at $95.60.

Mr. Parker, a track athlete at Penn State, joined Nike after college and landed in the company's R&D lab in Exeter, N.H., in 1979 as a designer. He went on to work with Nike co-founder Bill Bowerman and remained heavily involved in sneaker design even as he climbed the ranks at the company.

In 2006, Nike's longtime leader and co-founder Phil Knight handed day-to-day management to Mr. Parker, after his previously anointed successor, an outsider with little experience in footwear, left after 13 months. In 2016, Mr. Knight retired and handed over the chairman role to Mr. Parker.

Mr. Donahoe has a background in the tech world rather than sportswear. He is currently the CEO of ServiceNow Inc., a cloud computing company, and chairman of PayPal Holdings Inc. From 2008 until 2015, Mr. Donahoe was eBay's chief executive. He has been a Nike director since 2014.

Nike's CEO switch came the same day that rival Under Armour Inc. said founder Kevin Plank would step down as CEO in January. Mr. Plank, too, will stay on as executive chairman. That means both U.S. sportswear giants will have new leaders next year as they face shifting consumer tastes and a difficult retail landscape.

Write to Khadeeja Safdar at khadeeja.safdar@wsj.com

(END) Dow Jones Newswires

October 22, 2019 17:39 ET (21:39 GMT)

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