Old Navy chief out as sales falter again

Key Points:

• Old Navy is appointing Michael Francis as its new CEO on Nov. 2, with current CEO Haio Barbeito moving to an advisory role after four years, following a series of quarterly sales declines.
• Old Navy’s Q2 net sales fell 4% year-over-year to $2.1 billion, with comparable sales down 4%, impacted by an unexpected slowdown in customer traffic.
• Meanwhile, Gap Inc.’s other brands, including Gap and Banana Republic, showed growth in Q2, with Gap’s net sales rising 9% and comps up 10%, overshadowing Old Navy’s performance.
• Gap Inc. CEO Richard Dickson described Old Navy’s Q2 results as a modest miss due to known merchandising issues, while analysts see the CEO change as a necessary move to address deeper challenges in appealing to Old Navy’s family demographic.
• Gap brand’s turnaround is credited to improved product offerings and cultural relevance through collaborations and marketing, positioning it as the standout performer within Gap Inc.’s portfolio.