Nike Inc. (NKE) - Get Report shares fell to the bottom of the Dow Wednesday after it successfully poached ServiceNow (NOW) - Get Report CEO John Donahoe to replace longtime boss Mark Parker at the head of the world's biggest sportswear group.
Parker's departure comes as somewhat of a surprise for Nike investors, who were told as recently as last year that the long-serving boss would remain in the top role until at least the end of 2020 and beyond. Parker said his decision to step down was unrelated to the group's issues related to the Nike Oregon Project, a group of professional distance runners whose controversial coach was recently banned by international authorities amid doping allegations, or workplace harassment charges that ultimate lead to the departure of several senior executives last year.
Donahoe will take over on January 13, when Parker will become executive chairman.
"It is an honor to become President and CEO of this amazing, innovative company, and to join the more than 76,000 talented and passionate employees dedicated to serving athletes," Donahoe said in a statement. "Over the last five years, I've been proud to be connected to Nike through my role on the Board and now look forward to being a full-time member of the team, working even more closely with Mark, building on Nike's success and seizing the opportunities ahead."
ServiceNow shares were marked 3.8% lower Wednesday to change hands at $219.55 each following news of Donahoe's departure, while Nike was seen 2.75% lower from last night's close at $93.00 each.
Donahoe's leadership at online marketplace EBay Inc. (EBAY) - Get Report , where he served as CEO from 2008 to 2015, will likely serve him well at Nike, which has been shifting focus to digital sales amid a challenge from international rival Adidas AG (ADDYY) on both its home turf and key overseas markets such as China.
Nike's China sales rose 22% from last year during its fiscal first quarter, Nike said last month, a figure that rises to 27% when the impact of the stronger U.S. dollar is stripped out of the final reading.
North American sales rose 4%, a modestly softer-than-expected reading for Nike's home market, but that figure was offset by both a surge in women's apparel sales and a big improvement in the group's gross profit margin.
"This is an exciting time for Nike where we see brand strength and momentum throughout the world and great opportunity for future growth," said Parker. "I am delighted John will join our team. His expertise in digital commerce, technology, global strategy and leadership combined with his strong relationship with the brand, make him ideally suited to accelerate our digital transformation and to build on the positive impact of our Consumer Direct Offense."