Gap inc. (GPS) – Get Gap Inc. (the) report Shares fell on Tuesday after Sonia Syngal announced she would step down as group CEO after just two years and the struggling clothing retailer added that current quarter sales would continue to decline.
Syngal, who agreed to stay on for a brief transition period, will be replaced on an interim basis by Chairman Bob Martin, who has served on the Gap board since 2002. The group also added that Haio Barbeito, a former Walmart executive (WMT) – Get the report from Walmart Inc. Canadian unit, has been named CEO of its Old Navy brand, effective August 1.
Gap, which posted a bigger-than-expected first-quarter loss while slashing its full-year profit forecast in late May, said sales in its fiscal second quarter would likely fall from “high numbers” while that margins would continue to be squeezed by rising freight and input costs.
Syngal admitted in late May that late-arriving inventory, linked to global supply chain grunts, put Gap on its feet before spring and left the group unable to react to changing fast fashion trends that put more emphasis on formal outfits than Gap ones. traditional casual offerings.
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“Leading this great company and our 100,000 employees since 2020, through unprecedented challenges for our industry and society, has been a tremendous honor,” said Syngal. “Through it all, Gap Inc. and its dedicated teams have embraced change as an opportunity, restructured for future growth, crystallized unique brand identities rooted in cultural relevance and relentless transformation.”
Gap shares were down 5.95% in premarket trading to point to an opening price of $8.24 apiece, a move that would extend the stock’s year-to-date decline to around 53. .3%.
Gap’s early results, as well as its near-term outlook, stood in stark contrast to better-than-expected April quarterly reports from retailers such as Macy’s. (M) – Get the report from Macy’s, Inc. and Nordstrom (JWN) – Get the report from Nordstrom Inc.each of which was able to better serve customers focused on more formal fashion choices ahead of the first summer without pandemic restrictions in more than two years.
Macy’s CEO Jeff Gennette said the group has seen “a noticeable return to thrift clothing and in-store shopping, along with continued strength in luxury goods sales,” as it forecast a higher-than-expected full-year earnings of $4.53 to $4.95 per share after the first-quarter earnings beat.
Nordstrom, meanwhile, reported $3.57 billion in sales for the April quarter, up 18.7% from a year ago, and said it expects adjusted profit from the trading at $3.38 and $3.68 per share, with sales rising 8% from 2021 levels, for its full fiscal year.