ick Beighton has done a great job at Asos, but he’s leaving on a useless note.
The online fashion retailer stunned the market today by saying that its chief executive officer is stepping down with immediate effect. The search for his successor is just beginning.
The update has left analysts scratching their heads. There was no suggestion that Beaton was going out—now he’s gone overnight, though he’s turning around to help with the handover until the end of the year.
The company is preparing to go all out about strategy: Asos has announced an ambitious new growth goal that requires a CEO who is there for the long haul. Baton cannot commit.
The timing is unfortunate. Wind the clock 12 months ago and Asos was riding high, fueled by a pandemic-fueled buying spree driven by bored millennials and Gen Z-ers. The boom has since faded, and so has Asos’s share price. The stock is down more than 50% since its peak earlier this year. New constraints are emerging around supply chain problems. Competition is only heating up as more and more retailers step up their online game.
Shares of Asos took another leg down today, thanks to the surprise departure of Beaton, but also because of disappointingly weak guidance on sales growth next year.
When he took over from Asos founder Nick Robertson in 2015, he had big shoes to fill. They filled the retailer internationally and more than tripled sales for just shy of £4 billion.
Now the board wants to reach sales of £7 billion within the next four years – an even bigger question that poses a very high performance risk. Expect him to replace the superstar until the board can prove that Asos’ share price has fluctuated.