Gap names new Old Navy CEO as sales weaken

Gap has appointed a new chief executive for Old Navy as the apparel chain works to steady one of its most important brands. The change takes effect on Nov. 2 and comes after another weak quarter for the discount banner, which has been under pressure from softer customer demand. Michael Francis, who joined Old Navy as chief customer officer in May, will take over from Haio Barbeito, who will move into an advisory role.

Leadership reset at Old Navy

The move is part of a planned handover rather than a broader strategy shift, Gap chief executive Richard Dickson said in an interview with CNBC. He described the transition as intended to position Old Navy for its next phase while the company keeps focused on execution, core operations and select growth initiatives. Barbeito has led the brand since 2022.

Old Navy remains central to Gap’s business, accounting for nearly 60% of company revenue. That makes the performance of the banner especially important for investors watching the retailer’s turnaround effort. A leadership change at the top therefore carries significance beyond the brand itself, because it affects the group’s largest source of sales.

Sales decline weighs on the banner

The timing of the announcement follows a difficult fiscal second quarter for Old Navy. The brand posted net sales of $2.1 billion, down 4% from a year earlier, while comparable sales also fell 4%. That was a clear reversal from the 2% comparable-sales increase recorded in the same period last year.

Wall Street had expected a smaller decline in comparable sales, and the quarter marked the first negative same-store sales reading for Old Navy since the second quarter of 2023. Gap said the weaker result was partly tied to an unexpected slowdown in traffic. Dickson also said the brand’s summer marketing efforts did not put the product message front and center.

The company said traffic has already started to improve, but the latest figures underline how much work remains for the business. Old Navy’s new leader inherits a brand that is still fighting to rebuild momentum after a period of softer customer visits and weaker quarterly trends.

Who is taking over Old Navy? Michael Francis is becoming Old Navy’s new chief executive. He was appointed chief customer officer at the brand in May and will replace Haio Barbeito on Nov. 2. ### How did Old Navy perform last quarter? Old Navy reported net sales of $2.1 billion, down 4% year over year. Comparable sales also fell 4%, and the company said traffic slowed unexpectedly. ### Why does the leadership change matter? Old Navy makes up nearly 60% of Gap’s revenue. That means its performance is closely tied to the retailer’s overall results and turnaround efforts.

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