Famous Sports Apparel brand Nike on Thursday announced that Elliott Hill, a former senior executive with 32 years of experience at the company, will return to take over as president and CEO, replacing John Donahoe.
Elliott Hill’s appointment comes as the sportswear giant faces declining sales and increasing competition, with the company aiming to revive its growth trajectory. Nike shares jumped 8% in after-hours trading following the news.
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Hill, who retired from Nike in 2020, previously served as president of consumer marketplace, where he oversaw commercial and market operations for both Nike and its Jordan brand.
His leadership was instrumental in helping Nike’s business grow to over $39 billion in annual sales. Hill will officially step into the CEO role on October 14, with an annual base salary of $1.5 million.
Industry analysts praised the decision, with Jessica Ramirez of Jane Hali & Associates noting that Hill’s deep knowledge of the company and its brand gives a positive signal to investors. “It’s someone who knows the brand and the company very well,” she said.
Donahoe, who led Nike through the pandemic, initially saw success as he expanded Nike’s direct-to-consumer strategy and strengthened the company’s digital presence.
Under his leadership, Nike surpassed $50 billion in annual sales in fiscal 2023.
However, the company has struggled recently, with sales forecasts for fiscal 2025 expected to drop to $48.84 billion.
Sluggish consumer demand, inflation, and a slower-than-expected rebound in the Chinese market have all contributed to this downturn.
Nike also faces stiff competition from emerging brands such as Roger Federer-backed On and Deckers’ Hoka, both of which are gaining popularity with younger consumers seeking more fashionable, trendy footwear.
The lack of innovative new products from Nike has further impacted its market share.
Expectations for a leadership change at Nike had been growing after billionaire investor William Ackman revealed a significant stake in the company through his hedge fund, Pershing Square Capital Management. Ackman has not commented on his plans for Nike, but sources suggest Hill was his preferred choice for the CEO role.
Hill’s extensive experience managing Nike’s Jordan brand and his strong relationships with retailers could help the company regain momentum. David Swartz, senior analyst at Morningstar, emphasized that Hill’s knowledge of Nike’s core issues sets him apart from Donahoe, who lacked a background in the sportswear industry.
“Hill will need to work on repairing relationships with retail partners and drive product innovation,” Swartz said, referencing the ill will created by Nike’s push to focus more on its direct sales channels.
Thomas Hayes, chairman of Great Hill Capital, echoed these sentiments, calling Hill a “great pick” for Nike’s leadership.
He added that the company needs to focus on innovation and rebuilding ties with wholesalers to regain its competitive edge.
Hill began his career at Nike in a sales role, starting as an assistant in a Memphis showroom before moving up the ranks.
His return is seen as a strategic move to steer Nike back to growth amid challenges posed by changing market dynamics and rising competition.
Nike’s stock value rose by $11 billion in after-hours trading, reflecting investor confidence in the leadership transition.
Hill’s appointment marks a critical juncture for the brand as it aims to revive its performance and reestablish itself as a leader in the global sportswear market.
