SILVER SPRING, Md. – The chief executive who oversaw the rapid expansion of Ulta Beauty will take over as CEO of Foot Locker during a period of significant transition for the chain.
Mary Dillon, one of only 31 women leading a S&P 500 company before stepping down as the top executive at Ulta early last year, will take over at Foot Locker for Richard Johnson, who retires next month.
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Shares of Foot Locker jumped 20%, to $38.38, Friday.
Dillon takes control of the company next month with Foot Locker relying less on sales at malls, where foot traffic has plummeted, and moving away from one of its most dominant suppliers, Nike. Nike recently shifted aggressively to direct sales to customers.
Johnson, who has led the company since 2014, will continue as the board’s executive chairman through 2023.
Ulta's market capitalization tripled under Dillon between 2013 to 2021 and doubled its number of stores and loyalty memberships. She created a partnership to get Ulta into a major retail chain and in front of potential customers who may have been unfamiliar with the brand.
Foot Locker posted its highest annual sales since 1994 in its last fiscal year as the pandemic eased, potentially providing momentum as it expands its online sales platforms while opening more stand-alone locations.
Foot Locker says it will maintain a presence in malls, where their referee-striped sales force has been ubiquitous for decades.
It is diversifying the products customers see on shelves. Foot Locker says that by the fourth quarter of this year it expects no vendor to to make up more than 55% of its product budget. Just two years ago, Nike products accounted for as much as 75% of Foot Locker's product spending.
With Dillon’s arrival, it’s also diversified its leadership. When Dillon stepped down at Ulta in March 2021, the number of top female executives in the S&P 500 dropped to 30, or about 6%, according to The Conference Board and its data provider Esgauge.
That number remains low, and a woman holding the top job in any publicly traded company is uncommon. Dillon has served as the CEO of U.S. Cellular and held executive and leadership positions at McDonald’s and PepsiCo.
Foot Locker also posted strong second-quarter profits Friday that easily topped Wall Street expectations.
The New York company has 2,800 stores across 28 countries and reported $9 billion in sales last year. During the second quarter, it opened 34 new stores, remodeled or relocated 24 more and closed 50.
It also owns more than 500 Champs Sports stores and purchased West Coast shoe and athletic apparel retailer WSS in 2021 for $750 million.