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Shares in Nike jumped almost 10 per cent on Friday after the struggling sportswear maker replaced chief executive John Donahoe with retired executive Elliott Hill.

Nike said late on Thursday that Hill, a Nike veteran who previously served as president of consumer marketplace before retiring in 2020, will return to take the top job on October 14.

Donahoe, formerly of eBay and consulting group Bain, has served in the role since January 2020. He initially won praise for steering the brand through the coronavirus pandemic and accelerating its shift towards direct to consumer sales.

But in recent months Nike has ceded market share to competitors, including upstarts On and Hoka, and the company lowered its guidance in June, leading to a significant share sell-off.

Donahoe, 64, said “it became clear now was the time to make a leadership change, and Elliott is the right person”.

Hill, 60, is a native of Austin, Texas, who began his 32-year career at Nike as an intern before taking roles in sales and going on to lead all of the commercial and marketing operations for Nike and its Jordan brands.

Nike shares were up 8 per cent in early trading on Friday.

Phil Knight, Nike’s co-founder and controlling shareholder, thanked Donahoe for his service to the company. He said Hill’s experience at the brand was “exactly what’s needed at this moment. We’ve got a lot of work to do, but I’m looking forward to seeing Nike back on its pace.”

Nike shares fell 20 per cent in June after it warned of slowing demand for its core products. The sportswear giant admitted a strategy adopted during the pandemic to emphasise online sales, rather than its traditional mix of sales through brick-and-mortar retail and wholesale partners, had been too aggressive.

Wall Street analysts had openly questioned whether a former consultant and tech executive such as Donahoe was the right leader for Nike, a legacy consumer brand. Under his leadership, the company reached its goal of $50bn annual revenue last year. But Donahoe was seen as falling short in product innovation and developing newer, cooler shoes.

In June, Donahoe conceded it “has been a challenging last year” and spoke of “regaining our edge” — unusually backward-looking language for a company that has been the overwhelming global sales leader in trainers and activewear.

Over the course of Donahoe’s tenure, Nike pared back its relationships with retail partners that had been a cornerstone of its selling power, opening up shelf space for younger, hotter brands and traditional rivals such as Adidas.

In March, Régis Schultz, chief executive of retailer JD Sports, said Nike’s legacy trainer franchises, including the Air Force 1 and Dunk, were becoming tired and its top competitor, Adidas, was in demand for the myriad colours and styles of its Samba shoe.

“This is fashion,” he said. “It’s not about finding a new technology that transforms the world. It’s about having new silhouettes . . . I think Nike has been, and they recognise it, slow.”

Donahoe was only the fourth individual, and second outsider, selected to run Nike in its more than half-century history. By choosing Hill to succeed him, the board has chosen an experienced hand who knows the company culture in an effort to return the brand to a place of strength.

Tim Cook, Apple’s chief executive and lead independent director of the Nike board, said: “Elliott embodies the spirit of Nike and will bring his deep connection to sport, passion for their products, and competitive instincts to get the company back at the top of its game.”