Longtime Adobe CEO Shantanu Narayen announced last week that he would step down, a decision driven at least in part by investor impatience with the software company’s transition to AI. Adobe shares were hit hard in the “SaaSpocalypse” market sell-off, which affected companies whose per-user billing software tools are especially vulnerable to automation. The stock is down 25% for the year, and investors were not impressed with Adobe’s AI-driven quarterly revenue.
Narayen’s departure is a blunt reminder that, after years of promoting the technology, CEOs now need to turn their AI talk into results — or risk being let go.
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This watershed moment is contributing to an era of rapid turnover among chief executives. Last year, S&P 1500 companies named 168 new CEOs, the highest total in more than 15 years, according to Spencer Stuart, a global executive recruiting and leadership consultancy. Already this year, the CEOs of several companies, including Lululemon, Disney, Target and Walmart, have left their positions.
CEO tenures are getting shorter and fewer executives taking on the role have prior experience as CEO, the data shows, making it extremely rare for an executive to serve as CEO twice.
Overall, corporate America has turned into a veritable CEO grinder; leaders are consumed and discarded at a rate not seen in a decade and a half.
“What we are seeing now is clearly a sign of stress,” says Dirk Jenter, professor of finance at the London School of Economics and Political Science. AI is only part of the reason.
Hype around AI is a risk for corporate leaders
CEOs have been quick to attribute recent layoffs of operational employees to AI, but their own departures are rarely explained so simply. Still, there is little doubt that expectations around AI are contributing in some way to the greater frequency of chief executive departures.
There are cases like Narayen’s where shareholders are dissatisfied with the CEO’s ability to deliver his AI vision. “Investors are not necessarily very patient,” says Jenter. “They see billions being spent on AI investments and, at the same time, see very little return in the short term, which puts a lot of pressure on company leadership.”
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But investors also expect CEOs to deliver overall growth on par with the extraordinary gains recorded by companies at the center of the AI revolution, the so-called “Magnificent 7.”
“There is increasing pressure on all CEOs to grow at similar rates,” says Anthony Nyberg, professor of management at the University of South Carolina’s Darla Moore School of Business. “[Isso] it’s actually not sustainable or manageable for these companies.”
A rise in shareholder activism is another sign of growing investor impatience. Activist campaigns reached an all-time high of 255 last year, surpassing the 2018 record, according to Barclays. Campaigns in the US grew 23%.
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Activists are increasingly targeting CEOs. “Five or ten years ago, activism was largely about corporate politics,” Jenter says. “Now they are going directly after the top leadership of companies.” Thirty-two U.S. CEOs resigned in a year following an activist campaign, a 38% increase over the four-year average, Barclays data shows.
And there are also cases where boards turn to new (often younger) blood to lead companies through the transition to AI. Doug McMillon, the highly respected former CEO of Walmart who reportedly left by his own decision, cited AI in explaining his decision to step down in January. He said his successor, John Furner, was “uniquely capable of leading the company through this next AI-driven transformation.”
Another force behind this turnover: Board members today are less likely to be current or former CEOs than in the past, studies show. Nyberg argues that these less CEO-centric boards tend to be less sympathetic to incumbent executives — and perhaps less attentive to the full complexity of the role — which makes them more inclined to support leadership changes.
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Experts also argue that CEO turnover is offsetting a Covid-era backlog, a period in which boards prioritized continuity.
Overall, CEOs are having less time to deliver on their visions. The average tenure for S&P 1500 CEOs fell to 8.5 years last year, down from 9.2 years in 2024 — and the lowest since 2019.
The Broader CEO Turnover Trend
Rapid executive turnover is requiring boards to fulfill their succession planning responsibilities, and they are increasingly turning to internal talent to replace CEOs.
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The share of externally hired CEOs reached 60% in 2025, up from an all-time low of 57% in 2024.
Still, there are signs that boards have been caught off guard by the pace of turnover. Nineteen new CEOs were appointed from the company’s own board last year, the highest number since 2020, according to Spencer Stuart, “suggesting that some companies are not ready for succession.”
More often than not, internally promoted CEOs have no prior experience as a chief executive, a characteristic reflected in the data.
By 2025, 84% of new CEOs in the S&P 1500 were taking on their first role as a company CEO, reversing a multi-year trend of preference for executives with prior public company experience.
Boards often view experienced CEOs as a safer bet, but research from Spencer Stuart shows that, compared to veteran executives, newcomers have led their companies to higher market-adjusted total returns for shareholders with less share price volatility.
As the number of first-time CEOs increased, the age of new executives fell, reaching 54.4 years in 2025, down from 55.8 years in 2024. The share of CEOs aged 60 and over fell to 18%, after being close to 30% in the previous two years.
Even with higher stakes and greater turnover, today’s CEOs are unlikely to elicit much sympathy from the general public.
Median chief executive compensation reached $16.5 million in the S&P 500, according to 2025 proxy filings. (Exorbitant salaries may even be one reason second-time CEOs are so rare; few actually need the money.)
Still, the rapid turnover of CEOs should raise alarm bells outside the boardroom. CEOs who stay in office for more than ten years outperform the S&P 500 over their tenure more than those in any other time frame, Spencer Stuart research shows.
“That’s where the greatest shareholder value creation occurs,” says Jim Citrin, president of the consultancy’s global CEO practice. “Longer is better.”
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