Stephanie Linnartz received even much less time than anticipated to repair Beneath Armour’s many issues.
Linnartz, a veteran government who was beforehand No. 2 at Marriott Worldwide, left the worldwide lodge chain final yr to turn out to be CEO of Beneath Armour. She took over the struggling sportswear chain on Feb. 27, 2023—and, the corporate mentioned immediately, she will probably be leaving the CEO function on the finish of this month, after simply over a yr on the job. She had mentioned that her turnaround technique for the corporate would take three years to execute.
Kevin Plank, Beneath Armour’s controversial founder and controlling shareholder, will once more turn out to be its CEO, beginning April 1. The newest “boomerang” CEO to return to his former job (a gaggle that features Disney’s Bob Iger and Howard Schultz of Starbucks) will turn out to be his firm’s fourth CEO in 4 years. He first “stepped down” from the job in January 2020 to turn out to be government chairman, and he continues to personal 65% of the corporate’s voting shares.
Beneath Armour didn’t give a purpose for the abrupt CEO change, and a spokesperson declined to remark. In a LinkedIn publish, Plank thanked Linnartz for her contributions in direction of Beneath Armour: “She helped advance the corporate ahead in lots of vital methods, together with elevating our management expertise in product, design, provide chain, shopper loyalty, and regional administration,” he wrote. “A lot work nonetheless must be performed, however her management helped put us heading in the right direction towards profitable.”
Operating Beneath Armour was all the time going to be a turnaround job–which Linnartz went into with eyes large open. “I consider in taking calculated dangers,” she advised me final summer season, once I profiled her for Fortune.
“She has hit the bottom working, launching a clearly articulated three-year technique that units us up for strategic progress,” Plank advised Fortune, in an emailed remark, on the time. “I couldn’t be extra excited to have her at Beneath Armour and to work along with her day-after-day.”
However the challenges Linnartz confronted had been steep: Beneath Armour has struggled to develop income or income since its early heyday. Its share value has plummeted since its 2015 peak, and retail specialists name its model identification muddled, at greatest.
In the meantime, Plank’s politics and private life have continued to place his firm into sometimes-unflattering headlines. And Plank had remained an unavoidable presence on the firm nicely after his departure from the CEO function, as I noticed once I visited the corporate’s headquarters in August—the place I used to be regaled a number of instances with the story of how Plank began the corporate in his grandmother’s basement in 1996:
“Buildings and attire traces are numbered both 96 (for the yr he based Beneath Armour) or 37 (for the variety of KP’s faculty soccer jersey),” I wrote then. “One hall at headquarters is adorned with an unlimited photograph of that jersey, subsequent to blown-up variations of Plank’s early Beneath Armour enterprise playing cards, subsequent to #inspo phrases like ‘HUMBLE & HUNGRY BEGINNINGS.’”
Patrick T. Fallon—Bloomberg by way of Getty Photos
The seen ongoing presence of a charismatic founder could be a downside for a brand new CEO, says Neil Saunders, a GlobalData Retail analyst who covers Beneath Armour. “Even though another person is CEO, Kevin Plank remains to be there,” he says. “It’s nonetheless a really founder-led firm … and most CEOs don’t need backseat drivers.”
Whereas Linnartz had employed a number of new senior executives and launched a rewards program to extend buyer loyalty, her technique had not yielded rapid outcomes: Beneath Armour’s most up-to-date quarterly revenues fell 6 % from a yr earlier.
“She inherited a model that all the time had a variety of issues,” says Saunders. “And a yr is absolutely not sufficient time to make a change.”
Buyers at first cheered Plank’s return: The corporate’s shares rose in after-hours buying and selling, earlier than sliding again down. Beneath Armour additionally introduced that, as Plank turns into CEO, Mohamed A. El-Erian, the previous PIMCO CEO, will turn out to be the non-executive chair of its board.
“As I look again at my previous yr at Beneath Armour, one of many issues I’m most happy with is the wonderful expertise we’ve introduced into the group,” Linnartz wrote in an e-mail to Beneath Armour staff. She added that she needs Plank, “the manager management staff and all of you a lot success within the years forward.”
