Allbirds co-founder Joey Zwillinger is stepping down from his role as the company’s chief executive.

Effective March 15, COO Joe Vernachio will take over the job, with Zwillinger remaining on the board and serving as a special advisor to the brand.

Allbirds announced the news Tuesday as it reported that sales fell 14.7 percent in 2023 to $254.1 million. It attributed the decline largely to lower selling prices driven by increased discounting. Its net loss for the year rose to $152.5 million, up from $101.4 million in 2022. The company’s share price dropped 19 percent in after-hours trading at one point before recovering slightly.

The company has stumbled in its attempt to expand beyond the casual wool sneakers it made its name on and break into categories like performance apparel. Sales at the brand fell at the end of 2022 and have struggled to recover since. To counter the problems, Allbirds announced a strategic turnaround plan focused on being leaner and more efficient, and it has leaned into its sustainability credentials, revealing a zero-carbon sneaker it said would hit the market this year. Investors, however, have remained sceptical about Allbirds’ prospects.

It will now be Vernachio’s job to oversee operations and try to make the turnaround strategy successful.

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