Royal Philips President and CEO Frans van Houten will step down in October and be replaced by Roy Jakobs under a succession plan the Dutch health technology company unveiled Tuesday.
Shareholders will meet Sept. 30 to appoint Jakobs, who leads Philips' connected care division, as van Houten's successor effective Oct. 15.
The executive leadership change comes amid a massive recall of ventilators prescribed to patients for sleep apnea, which the company commenced last year. Philips produced 3 million replacement devices and repair kits as part of the recall, the company disclosed in its quarterly report last month. Jakobs has been responsible for the voluntary recall notification and field safety notice since last year, according to a news release.
Jakobs joined Philips in 2010 and was named the chief business leader of its connected care unit in 2020. He oversaw acquisitions including a $2.8 billion deal to purchase remote cardiac diagnostics and monitoring company BioTelemetry, according to Philips.
Van Houten has been CEO since 2011 and will remain as an advisor to support the transition through April 30. "It has been both a privilege and a pleasure to lead the transformation of Philips, over the past 12 years, into one of the largest health technology companies in the world,” van Houten said in a news release. “While I am proud of our many accomplishments, much remains to be done to enhance the resilience of Philips to manage through current setbacks and adverse market conditions.”
The outgoing chief executive led the company’s transition from a “diversified industrial conglomerate into a focused, global solutions leader in health technology,” Supervisory Board Chair Feike Sijbesma said in a news release.
During the second quarter, Philips recorded a 7% decline in sales to $4.25 billion, which the company attributed to supply chain shortages and COVID-19 lockdowns in China. Operating income plummeted 89% to $11.2 million compared with the year-ago period.