What Needs To Change For Old Navy (if Anything) as it Gets a New CEO?
The latest news: Gap’s Old Navy banner is getting a new CEO, with chief customer officer Michael Francis being bumped up to the role, taking over from outgoing CEO Haio Barbeito. Barbeito had helmed Old Navy since taking the chief executive position in 2022, as CNBC’s Laya Neelakandan reported.
The move comes as Old Navy, and to some degree Gap more broadly, delivered a soft second quarter. Old Navy saw net sales down 4% YoY (reaching $2.1 billion), with comp sales also dipping 4% (against a 2% increase in the year-prior period).
“Overall, Gap reported mixed results for its fiscal second quarter, beating analysts’ estimates for earnings per share but underperforming revenue expectations. Gap Inc. comparable sales were down 1% for the period, including a 3% year-over-year decline in in-store sales,” Neelakandan wrote, adding that Gap CEO Richard Dickson had told the media outlet that the Old Navy leadership swap was part of a “planned and thoughtful transition” in preparation for a new chapter.
“We’ve been working — from fixing fundamentals to building momentum and ultimately looking to accelerate growth, and so there’s not a change in strategy,” Dickson said.
“We’re just going to continue to execute better, continuously improve our core business, while we drive some accelerators that we’re really excited about,” he added.
With Old Navy being responsible for approximately 60% of Gap’s total revenue, sluggishness at the apparel retailer is certainly a concern. The Q2 comp sales downturn represents the first instance of such since Q2 2023, and Dickson gestured toward an unfortunately ambiguous summer marketing campaign — and assortment hurdles — as at least partially responsible for the soft numbers. The company itself also indicated that an unexpected slowdown in foot traffic had contributed to lackluster sales.
“Ultimately, our slight miss on total company was really due to Old Navy’s seasonal product assortment. We know we didn’t execute well on our seasonal product, but if there’s good news in this, seasonal is behind us,” Dickson stated.
“On balance, we’re running a very disciplined organization with a playbook that is working. These things take time. I think, pointing to Gap as the lead success story of our playbook, you can see the ability for us to actually deliver relevance and revenue, and we’re well on our way,” he added, adding a bit of a silver lining by underscoring the resilience of the company’s consumer base across all income brackets.
Gap climbs after leadership change at Old Navy, profit forecast raise https://t.co/zXVNQcTMcT
— BNN Bloomberg (@BNNBloomberg) August 28, 2026
Investors, New CEO Seem Bullish Over Old Navy’s Near-Future
Investors seem to believe in Old Navy, with share prices have climbed significant since the announcement — and gained ever further traction on August 29, up more than 13% on the day as of mid-afternoon.
As for Francis, he had a few words to share in advance of taking over the helm.
“[Old Navy will] continue to sharpen our customer focus, strengthen the brand’s cultural relevance, enhance the customer experience across every touchpoint and build on the momentum already underway.”