On Wednesday, Under Armour announced that their president and chief executive officer Patrik Frisk would be stepping down and chief operating officer Colin Browne would be the interim CEO, effective June 1. The announcement was made after the company released a disappointing quarterly report. The stock fell by over three percent in extended trading.
Although no reason has been given by either the company or Frisk, it was reportedly a decision that was reached mutually. Frisk will remain as a consultant through September 1. The stepping down decision was unexpected. Frisk joined the Baltimore based company in 2017 and has been leading it since more than two years. He had become the CEO on Jan 1, 2020, replacing founder Kevin Plank. He has not responded when asked for the reason of his departure, by multiple outlets.
In a statement on Wednesday, Frisk said that he was “extremely proud of what we’ve accomplished as a team.” He said that they had strengthened the iconic brand and had “significantly” solidified Under Armour’s operations.
His tenure, during the pandemic, saw the CEO take steps to bring about a turnaround by limiting discounts offered to third party retailers in order to boost profit. He also tried to make it a high end brand comparable with rivals Nike and Lululemon.
Under Armour has reported a loss in the transition quarter as it is shifting its fiscal year. Supply chain issues affected the brand and the recent Zero Covid policy in China decreased demand. This led to a disappointing outlook for fiscal year 2023, from April 1, 2022 through March 31, 2023.
The announcement also said that the board would be looking for a permanent replacement, internally and externally. Under Armor has seen close to 50 percent drop in share price this year, while rival Nike saw a drop of more than 34 percent.
On Wednesday evening, founder Kevin Plank told CNBC in a phone interview that the company will enter a new phase of growth by upgrading its e-commerce operations. He also said that he was not being considered for the role of CEO, as of now.