Nike CEO’s Future in Question as Demands for Turnaround Grow
- Sep 2, 2024
- 1 min read
Updated: Sep 20, 2024
Activist investors and analysts are amongst those calling for change at sportswear behemoth, Nike, as pressure grows on the company’s CEO, John Donahoe.
A groundswell of discontent has been growing since the company posted its slowest annual sales gain in 14 years in June. These figures did not take in the period of the Pandemic.
The company’s turnaround plan is seeing some momentum, reports the Business of Fashion. “Donahoe retains the backing of the Nike board, while the brand has gained momentum in its early turnaround plan thanks to a successful Olympics marketing push and the rehire of key veterans Nicole Hubbard Graham and Tom Peddie,” it shares. However, questions are still being asked.
In June, the company’s stock was downgraded by six investment banks because of its dire 2025 fiscal projections. As CNBC reported, this prompted some stark responses. “Analysts at Morgan Stanley and Stifel called Nike’s management, including CEO John Donahoe, into question and said the athletic company is losing its once ironclad credibility”, the news channel wrote. Stifel analyst Jim Duffy wrote: “Management credibility is severely challenged and potential for C-level regime change adds further uncertainty.”
The ultimate fate of the company remains in the hands of founder Phil Knight. However, despite these poor results - and the fact that stock is down more than 25% since Donahoe took the helm - Knight responded in a statement that his CEO has his “unwavering confidence and full support” and he had seen the plans for the future and “wholeheartedly” believes in them.
