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Patrick Frisco was tasked with expanding Under Armour. He lasted 2 years.

When Under Armor founder and then-CEO Kevin Plank announced in 2019 that he would resign, Patrick Frisk was seen as the natural successor. Joining the brand in 2017, Frisk had experience as a chief operating officer and was already influencing Under Armour’s back-end operations.

“While we certainly don’t want to diminish Mr. Plank’s success and accomplishments in building the company to a global brand worth over $5 billion, we believe that in order to take the company to the proverbial ‘next level,’ they could use some New blood in the CEO’s chair,” a team of Wells Fargo analysts wrote at the time, calling Frisco a “more than capable successor” based on his improvements in inventory management and other operational elements of the business.

Then it was a surprise when Frisk came out just two years later runs a track and field giant.

“I think it’s pretty clear that they’ve been grooming him for this role,” Tom Nikic, senior apparel and footwear analyst at Wedbush, said of Frisco, adding that he became a highly visible member of the company when he joined in 2017. “I think the recent changes signal a change in philosophy about the way the company is run between Patrick and Kevin. And to put it simply, the level of growth that the company should achieve.”

In an email memo when Frisk first stepped down, Nikic pointed to manager separation agreement as proof that the care was not mutual. Under Armor agreed to pay Frisco double his annual salary, a lump sum of nearly $7 million, plus $238,000 in moving expenses and an additional $1.3 million in “consulting fees” through September 2023.

The company itself did not give any specific reason for Frisco’s departure, though Planck said in a statement at the time that Frisco had made “significant strides in driving operational excellence across the enterprise, and Patrick’s steady leadership has been critical to strengthening our foundation and positioning the company for our the next stage of growth.” The company declined to comment further on Frisco’s departure or what Under Armor is looking for in a new chief executive.

Frisk a list of organizational tasks has been completed at Under Armour, saying last November that the “work to transform” the brand was mostly done. He reduced Under Armour’s reliance on discounting, helped the retailer move out of wholesale and strengthen DTC channels, and lowered the stock. But while that work was needed, Frisco’s focus on more sustainable, slower growth may not have aligned with Plank’s vision for the brand.

“There are very few examples of an aggressive, growth-oriented leader being replaced by a performance expert,” said Greg Portell, managing partner of Kearney’s global consumer practice. “Perhaps only Apple comes to mind, where Jobs was there and Cook, who is definitely a tactician, did so well.”

A return to the get-big-quick mentality.

2021 was a landmark year for Under Armour. This was the year Lululemon’s revenue overtook Under Armour’s. Sports recreation brand brought in $6.3 billion to $5.7 billion Under Armour, representing 42% growth, with plans to double this amount by 2026. Under Armour’s sales growth, by contrast, was in the mid-20% range.

Fast forward a year, Under Armor in May projected revenue growth of 5% to 7%while Lululemon has expecting growth of 24% to 26%. For two companies of roughly the same size in the same category, that’s a notable difference. According to Nikic, when Plank was CEO, Under Armour’s growth rate was something to brag about.

Under Armour’s projected sales growth this year is also lower than its competitors.

Cara Salpini/Retail ; Data: Lululemon and Under Armor press releases

“The company’s pitch was ‘get big faster,’ and they held earnings calls and touted a streak of more than 20% quarterly revenue growth,” Nikic said. “Creating growth has been extremely important to Kevin, and I think he’ll probably look around and see really strong growth from Lululemon … Puma, Nike and Adidas.”

On the other hand, Armor expects that “the level of growth is not what most other sportswear brands have seen, and that probably didn’t sit well with Kevin.” Under Armor declined to comment when asked by Retail Dive if Frisco’s departure was related to revenue growth.

Whoever takes on the next role, strong growth is “pretty much the minimum requirement,” Nikic said. But how does Under Armor get back to a more robust level of growth?

https://www.retaildive.com/news/ceo-patrik-frisk-steps-down-under-armour-future/626171/ Patrick Frisco was tasked with expanding Under Armour. He lasted 2 years.

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