Nike just announced a Silicon Valley tech exec as its next CEO, and it reveals how it's thinking about its future

Business Insider Finance 3 weeks ago

After years of aggressively chasing digital growth at Nike, CEO Mark Parker announced he was stepping down on Tuesday and fittingly ceding his role to a tech titan: former eBay CEO John Donahoe. 

Under Parker, Nike has invested heavily in digital transformation and evolution, a move that has helped the athletic retailer thrive. Nike greatly outpaced Wall Street's expectations in its most recent earnings call, in large part due to a significant digital push around customer experience both in-store and online, as well as across supply chain operations.

"While products are usually the first to grab the attention of our consumers, we deepen those relationships through the power of digital," Parker said in a call with investors in September, citing that digital sales grew by 42%. At the time, he used the word "digital" 44 times — in other recent calls, that number has hit as high as nearly 70 mentions, highlighting his intense focus on technology. 

Donohue will officially take the helm on January 13, at which point Parker will assume a new role as executive chairman of the board of directors, according to a Nike press release. Parker was the CEO of Nike for 13 years, and his unexpected departure came after he had formerly said he planned to continue to lead the company beyond 2020, the Wall Street Journal previously reported. 

Though Parker was recently embroiled in controversy involving exchanging emails with Nike-backed running coach Alberto Salazar and Dr. Jeffrey S. Brown regarding experiments with performance-enhancing drugs, he assured employees that "there are no issues" he is concealing by stepping down, according to an internal memo obtained by Bloomberg

"To be clear, I'm not going anywhere," he said, according to Bloomberg. "I'm not sick. There are no issues I'm not sharing. I strongly believe the best way for us to evolve and grow as a company is to bring in a phenomenal talent to join our team who has long been part of the Nike family."

Adding 'horsepower' to Nike

While Parker's departure may have been a surprise — particularly coming just hours after Under Armour CEO Kevin Plank also announced he would be stepping down — the selection of Donahoe, with his seasoned background in Silicon Valley tech, was anything but. 

In an interview discussing his successor with CNBC, Parker said Donohoe — who has been a Nike board member since 2014 and is currently the CEO of the cloud-computing software company ServiceNow and chairman of PayPal Holdings  — is "the best choice to come in and actually usher in this next wave of growth for Nike."

"He's coming in with a lot of experience around consumer digital, enterprise technology, global strategy, leadership, he's a great developer of talent," he said. "He really clicks a lot of the boxes we're looking for and to add horsepower to Nike."

Parker said that as a member of the board, Donohoe already has an intimate understanding of the company, and that he's been am integral part of strategic planning around digital growth already. 

"We have incredible horsepower already, but John comes in, adds horsepower and I think he's going to help us accelerate our whole digital transformation and some of the important steps we're taking to be even more competitive," Parker told CNBC.


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