In a bid to end a yearlong period of malaise, Macy’s announced the replacement of Chief Executive Officer Terry Lundgren with Jeff Gennette, the company’s current president, effective in the first quarter of 2017.
The move will end Lundgren’s 14-year tenure as CEO and bring Gennette onto the board of directors. “Jeff Gennette is an extraordinary leader who has distinguished himself as a skilled merchant and retail operator,” Lundgren said in a statement. “He has worked closely with me over the past two years as president of Macy’s, Inc. in a first step in this succession process, and we are closely aligned on creating a compelling and sustainable path forward.”
But investors hoping for fresh blood might be let down by the new pick. Gennette began his career in retail at Macy’s West in 1983 and has spent time in executive positions at Macy’s across the country since. He was named chief merchandising officer in 2009 and president in March 2014.
Still, Gennette has been seen as a potential star executive in the ailing retail space. In 2013, he declined an offer to take a CEO position at ShopKo, a Midwestern retailer, the Wall Street Journal reported at the time.
Macy’s has been caught in a challenging market collapse for brick-and-mortar retailers, as consumers have increasingly moved their shopping online to Amazon and other web stores. Shares of Macy’s (NYSE:M) sank more than 50 percent over the past year.
But Gennette sounded a note of confidence in the release Thursday. “This is the time for us to be laser-focused on what is most important to our customers and how we can best deliver the shopping experience that will secure our position as the premier omnichannel retailer of the future,” he said.
“There is no doubt that Macy’s, Inc. will need to be a significantly different retailer in the future in the way we operate and approach the marketplace,” Gennette added.
Investors greeted the news warmly. Macy’s stock rose 3.5 percent in the first half-hour of trading Thursday.