Nike's incoming CEO will make $27 million — over $2 million less than his predecessor

• Nike veteran Elliott Hill is returning to lead the company as its CEO, replacing John Donahoe.
• The company offered Hill $27 million in compensation, $2 million less than Donahoe's 2023 earnings.

Nike has found a new leader, but they'll be paying him more than $2 million less than the salary of the company's outgoing CEO.

On Thursday, the sports giant announced that Elliott Hill, a company veteran, will take over outgoing CEO John Donahoe on October 14.

Hill's base compensation is $1.5 million a year. He stands to take home an annual bonus of twice his base salary, depending on the company's performance, according to a Securities and Exchange Commission filing on Thursday.

Per the SEC filing, Hill's deal includes a long-term incentive package in the form of stock options valued at $15.5 million. Nike also offered Hill an additional $4 million in cash to be awarded when he starts at the company. The filing added that he will also receive a $3 million equity grant, to be paid out over three years.

Hill's total compensation package is valued at $27 million. That's lower than his predecessor John Donahoe's $29.1 million remuneration in 2023.

Donahoe's compensation consisted of a $1.5 million base pay, more than $19.2 million worth of stock options, over $1.9 million in annual incentives, and over $6.4 million in retirement benefits, according to a July SEC filing.

Hill is earning less, but he's also set to inherit a host of challenges. That includes the company's December game plan to slash $2 billion in costs over the next three years — which involves laying off around 1,500 workers.

But Hill is returning to the place where he built his career, and will be a familiar face to some employees. He started at the company as an intern in 1988 and led its consumer and marketplace division before retiring in 2020. Donahoe, meanwhile, was parachuted into the role after previously leading tech companies like ServiceNow and eBay.

Still, Hill is earning more than other CEOs in the sporting goods industry. This includes Calvin McDonald, CEO of Lululemon, who made over $16 million last year, and Kevin Plank, CEO of Under Armour, who earned over $4 million in the same period, according to reports from both companies.

Hill said in a press release on Thursday that he looks forward to his return to the company. In correspondence to his staff seen by Bloomberg on Friday, Hill acknowledged that "things haven't been easy" for Nike while urging employees at the company "to move with speed and a sense of urgency."

Nike did not respond to requests for comment by Business Insider sent outside business hours.