August 28, 2026
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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.”
BrainTrust
Nicholas Morine
Recent Discussions
Discussion Questions
Does Old Navy need to make substantial changes to its operating model and marketing approach to turn the ship around? If so, what would you recommend?
Do you believe a new CEO and a new direction can substantially re-energize Old Navy’s shopper base? Or would it be best to work with minor tweaks to the existing formula instead?
Can (or should) Gap attempt to further broader its base of banners so that it’s not so reliant on Old Navy’s performance? What would you say to leadership on this score?
Poll
While financial pressures on family shoppers are unhelpful to Old Navy, they do not explain the brand’s chronic underperformance and loss of market share. Those things are primarily caused by internal problems – the most significant of which is a lackluster range. Summer assortments, especially in women’s, lacked a point of view and had too few hero products to generate excitement. This initially weakened conversion and, because the problem has persisted, it is now also eroding brand relevance and giving customers fewer reasons to visit. Old Navy needs to reenergize the range and to correct the traffic problem it needs to back this with a strong marketing campaign to get back on the radar.
Old Navy needs to be fun again – come in for a pair of reasonably priced jeans, and walk out with a band t-shirt and flip-flops too. They’ve lost the ‘amusement’ mentality that shopping there previously used to have. Whether this is Merchandising or Operations driven, I cannot say.
delivered a soft second quarter. Old Navy saw net sales down 4% YoY (reaching $2.1 billion), with comp sales also dipping 4%
The definition of “soft” has become as loose as an XXL tee.
Old Navy sells clothes cheaply, just like a lot of other people; in today’s environment – and one might add, caustically, with GAP’s long history of unexciting results – they’re probably where we should expect them to be…if not necessarily where they want to be.
Gap CEO Richard Dickson said it: “Execute better.”
Old Navy should take that advice right now because shopping there has been confusing lately. We don’t shop at Old Navy for formal wear; we shop there fun and affordable fashions.
Maybe it’s time to get back to what Old Navy does best. And execute it better.
Old Navy’s problem is a clock problem. The company runs on a legacy merchandising clock, committing fabric and volume months ahead in deep runs of single styles. Fast fashion runs on a weeks-long clock, testing small batches and scaling winners in real time. The customer runs on a cultural clock, where trends surface on social feeds and expire before Old Navy’s orders even land. Two straight quarters of seasonal misses show what happens when three clocks disagree: the slowest one loses. Michael Francis brings real brand credentials, but cultural relevance is a fast-clock game played with slow-clock inventory. His mandate is synchronization. Compress the pipeline, build read-and-react buys, and the fun returns on schedule.
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While financial pressures on family shoppers are unhelpful to Old Navy, they do not explain the brand’s chronic underperformance and loss of market share. Those things are primarily caused by internal problems – the most significant of which is a lackluster range. Summer assortments, especially in women’s, lacked a point of view and had too few hero products to generate excitement. This initially weakened conversion and, because the problem has persisted, it is now also eroding brand relevance and giving customers fewer reasons to visit. Old Navy needs to reenergize the range and to correct the traffic problem it needs to back this with a strong marketing campaign to get back on the radar.
Old Navy needs to be fun again – come in for a pair of reasonably priced jeans, and walk out with a band t-shirt and flip-flops too. They’ve lost the ‘amusement’ mentality that shopping there previously used to have. Whether this is Merchandising or Operations driven, I cannot say.
The definition of “soft” has become as loose as an XXL tee.
Old Navy sells clothes cheaply, just like a lot of other people; in today’s environment – and one might add, caustically, with GAP’s long history of unexciting results – they’re probably where we should expect them to be…if not necessarily where they want to be.
Gap CEO Richard Dickson said it: “Execute better.”
Old Navy should take that advice right now because shopping there has been confusing lately. We don’t shop at Old Navy for formal wear; we shop there fun and affordable fashions.
Maybe it’s time to get back to what Old Navy does best. And execute it better.
Old Navy’s problem is a clock problem. The company runs on a legacy merchandising clock, committing fabric and volume months ahead in deep runs of single styles. Fast fashion runs on a weeks-long clock, testing small batches and scaling winners in real time. The customer runs on a cultural clock, where trends surface on social feeds and expire before Old Navy’s orders even land. Two straight quarters of seasonal misses show what happens when three clocks disagree: the slowest one loses. Michael Francis brings real brand credentials, but cultural relevance is a fast-clock game played with slow-clock inventory. His mandate is synchronization. Compress the pipeline, build read-and-react buys, and the fun returns on schedule.