A shakeup of Under Armour’s executive structure announced yesterday could bode well for the long-term outlook of the company, according to one Wall Street analyst following the company.
The biggest change: Kevin Plank, who founded the company, will retain his CEO role but pass off the title of president to Patrik Frisk, who recently served as an executive for VF Corp. Frisk will also be COO.
The result is that six executives will be reporting to Plank instead of 10, which will “finally decentralize some decision making within the company,” according to analysis by Susquehanna International Group’s Sam Poser.
According to Poser, this bodes well for Under Armour.
“We do believe that [Under Armour] will benefit from removing many of the day to day operational activities from Mr. Plank’s plate,” Poser’s note reads. “We are also hopeful that Mr. Frisk will facilitate a review of Under Armour’s long-term brand strategy.”
Still, Poser and his team are concerned with Under Armour’s short-term focus on growth through selling in discount channels without much difference in product, and hope that this signals a shift in focus.
“We wonder if the change of leadership signals any semblance of a temporary pause in [Under Armour] being a growth company in order to protect the Under Armour brand,” Poser said.