Fashion retailer Gap boss ousted as bailout fails

Gap shares fell as rising costs and discounts thwarted Sonia Syngal’s turnaround plan after more than two years as the clothing retailer’s chief executive.

Chairman Bob Martin immediately takes over as interim CEO, and the retailer has lowered its second-quarter operating margin expectations to zero. The shares, which fell 8.7% in New York trading, have lost more than half their value so far this year.

Ms Syngal was hired just before the pandemic hit, which reduced demand and intensified the focus on online shopping amid mandatory store closures.

Missteps such as a clumsy implementation of enlarged women’s sizes at the company’s Old Navy chain, whose top executive left earlier this year, have swelled stock levels just as demand may have -be reached its maximum.

“Several disappointing catalysts have now struck, the bullish case has been eliminated in the short to medium term,” Wells Fargo analysts said.

In early 2020, it was Ms Syngal who stepped in to replace a CEO who abruptly left amid operational issues. Predecessor Art Peck left after an abandoned plan to spin off Old Navy and failed to revive sales growth.

After taking office in March 2020, Ms Syngal immediately had to navigate Covid-19.

Bloomberg

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