US Steel CEO Mario Longhi’s Sudden Departure

In early May, US Steel CEO Mario Longhi stepped down from the CEO job, with plans to fully retire from the company by the end of June. Many observers saw a connection between that sudden move and the company’s troubling earnings report a few weeks earlier.

Longhi joined US Steel (#249 on the CEO1000) in 2012 as executive vice president and chief operating officer, and took over as president and CEO in 2013. He inherited some significant long-term problems, including an aging plant infrastructure and slowing demand in emerging markets. In response, he oversaw a transformation effort dubbed “The Carnegie Way,” which led to a $745 million benefit to the company in 2016.

“BURRITT WILL NEED TO MOVE RAPIDLY TO ESTABLISH HIS LEADERSHIP.” – Jeff Kirschner, RHR International

Nevertheless, in the first quarter of this year, US Steel’s revenues missed analyst expectations, and the company showed a surprisingly large loss of $180 million—at a time when market conditions for the typically cyclical industry were on the rise. The result: a rapid drop of more than 25% in the company’s stock price.

Longhi’s replacement is David B. Burritt, the company’s president and COO—positions that he moved into earlier this year. Burritt brings a largely financial background to his new job—he joined US Steel as CFO and executive vice president in 2013, and before that spent 32 years at Caterpillar, where he eventually become CFO.

“By naming a lifelong finance leader to run the company, the board is signaling the need to quickly stem recent losses while retooling the enterprise to compete successfully in the future,” says Jeff Kirschner, a partner at RHR International. “Burritt will have a large leadership challenge in turning around the company. He will need to move rapidly to establish his leadership—through re-enrolling key talent and articulating a strategy that takes advantage of market conditions and lifts performance in the short-term.”