Nike CEO Resigns, Paypal Board Chairman To Step In: 'He's The Best Choice'

Long-serving Nike CEO Mark Parker has resigned and will step down in January next year. Nike confirmed the chief’s departure Tuesday and said John Donahoe, CEO of cloud company ServiceNow and also Paypal Board chairman will replace him.

The shock news comes less than two years after Nike reiterated Parker would remain CEO “beyond 2020.”

Parker told CNBC that his successor Donahoe is “the best choice to come in” and Donahoe would enable the “next level of growth,” digitally, for the company.

Nike’s announcement also coincided with the announcement from competitor Under Armour that CEO Kevin Plank’s will leave on Jan. 1.

Parker was the Nike CEO since 2006. He will take over the position of the company’s executive chairman, per the press release.

Rising from the ranks as a designer, Parker has completed four decades in Nike and was its vice president of global footwear and co-president previously.

According to a CNN report, Parker in a note to employees said: “To be clear, I'm not going anywhere. 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.”

Digital focus and brand cleaning

In recent times, Parker's tenure had been marred by some scandals. In the spring of 2018, multiple lawsuits were bothering the company on alleged gender discrimination and a “boys' club” culture. It finally led to the exit of president Trevor Edwards, who was once seen as Parker’s likely successor.

In September, the company shut down its running club, Nike Oregon Project, after coach Alberto Salazar was banned from the sport over anti-doping violations.

Parker in his chat with CNBC denied that the shuffle had anything to do with the doping allegations, per Nike news.

According to some reports that examined emails from the U.S. Anti-Doping Agency, Parker was aware of Salazar’s experiments that used testosterone cream for track-and-field athletes.

Nike stock has rallied 29 percent this year, taking the market cap to roughly $149.2 billion. In the after-hours trading of Tuesday after the announcement, Nike stock was flat.

Apple CEO hails Parker’s leadership

Parker drew praise from Apple CEO Tim Cook, who is Nike’s independent director and chair of the succession committee.

Cook said: “Mark and John are two exceptional leaders.” The Apple CEO noted that under Mark’s leadership, Nike’s revenue tripled and became one of the most iconic and innovative brands in the world.

Meanwhile, Nike shoes popular in varied categories such as Nike shoes for women, Nike shoes for men, Nike running shoes and Nike basketball shoes had another branding feat with its customization for NBA opening recently.

According to NBA news, Nike outfitted 24 NBA athletes in a one-off “Nike By You” custom designs for the first week of the 2019-2020 NBA schedule season and showed that personalization has no limit.

Nike's program for the NBA came after it lifted color restrictions and allowed the use of “even more silhouettes to tell their stories through unique designs around an opening week,” said Les Green, marketing director for Nike By You.