Under Armour Founder Kevin Plank Stepping Down, Patrik Frisk Named New CEO
BALTIMORE (WJZ/AP) -- Under Armour founder Kevin Plank will step down as CEO in the new year to become the company's executive chairman and brand chief.
President and Chief Operating Officer Patrik Frisk will become the Chief Executive Officer effective January 1.
Frisk, who became president and chief operating officer two years ago, will be the athletic gear company's second CEO since Plank founded it in 1996.
The 56-year-old Frisk will report to Plank and will take a seat on the board.
Plank will join the company's Board of Directors as the Executive Chairman and Brand Chief, a move he said was his own decision that will keep him with the company but will hand over day-to-day operations.
"Patrik's proven track record of industry experience, straightforward leadership style and championship of our brand and culture makes him uniquely positioned to smartly capitalize on the opportunities in front of us," Plank said in a statement.
Plank stressed the move was "not retirement."
"Somebody has to have their hands on the wheel, and you can't have two people yelling, 'Go left, go right,'" he said from the company's Baltimore headquarters Tuesday morning.
Frisk has more than three decades of experience in the business, working at Under Armour since 2017 and at Aldo before that. He said observers won't see the company significantly change course.
"It's been planned, and we're going to continue to run the same plan that's been put in place with the executive team," Frisk said.
While the company is worth $9 billion today, it has stumbled in recent years, particularly with slow North American sales.
Under Armour has threatened Nike, landing major deals with Major League Baseball and star athletes like the NBA's Stephen Curry.
But it also faces threats of its own, like the growing popularity of athleisure wear, clothing that can be worn at work and the yoga studio.
Last year Under Armour said that it was cutting about 400 jobs as part of its restructuring efforts. The company began streamlining in 2017 after explosive sales growth petered out as consumers shifted some of their dollars toward active lifestyle brands like Lululemon.
It has also come under fire for a troubling workplace culture, as reported in the Wall Street Journal, including allowing employees to expense strip club visits. That practice is no longer allowed.
Plank also received backlash in 2017 for making comments supportive of President Donald Trump.
"To have such a pro-business president is something that's a real asset to this country," Plank said in a CNBC interview at the time.
He left Trump's manufacturing council later that year and defended Baltimore in the wake of the president's attacks on the city over the summer.
Shares of the Baltimore company are down 23 percent since its last earnings report in July, but investors reacted positively to the announcement. Under Armour's stock rose more than 6 percent on Tuesday.
Economist Anirban Basu with Sage Policy Group said the change will give Plank more time to work on projects including Baltimore's Port Covington development.
"Most companies have had bad press, but I wouldn't attribute that to Mr. Plank's leadership," Basu said.
The company is planning aggressive retail expansion in Asia and recently opened a regional headquarters in Hong Kong.
"Most companies would kill to have the kind of brand Under Armour has, but it's a competitive world and shareholders want to see additional progress," Basu said.
