Sonia Syngal, the CEO of Gap, has quit suddenly as the US fashion giant’s board looks to address poor sales, especially at its traditional growth engine, price-oriented Old Navy.
While the reasons behind Syngal’s departure are unclear, its suddenness shocked retail industry observers. In a statement released overnight, Gap said Syngal would depart her role, and leave the board with immediate effect.
Gap has appointed a 26-year veteran of Walmart to head Old Navy. Horacio “Haio” Barbeito will assume the role of president and CEO on August 1, replacing Nancy Green, who left the company unexpectedly last April.
Executive chairman Bob Martin will take on the Gap CEO role on an interim basis while the board finds a long-term replacement.
‘Not an ideal time’
“As much as this is unavoidable, the lack of a CEO at the helm is not ideal at a time when Gap is navigating some very choppy waters,” commented Neil Saunders, MD of GlobalData, who described her tenure as “a mixed one”.
“On the one hand, she deserves credit for seeing the company through the challenges of the pandemic and for injecting some much-needed energy into some of its tired brands. In particular, the partnership with Yeezy has captured the attention of younger shoppers and was a bold move for the usually colourless Gap division. The deal to sell Gap branded homewares via Walmart underlines Syngal’s willingness to experiment and try new things,” said Saunders.
“However, as much as Syngal has moved things forward, progress has been slow, and initiatives have been piecemeal rather than part of a coherent grand plan of reinvigoration. The result is a company that in its core businesses, still suffers from many of the same issues that have dogged it for years.”
Saunders described the “chronic underperformance” at Old Navy – usually the growth engine of the group – as exacerbated by operational stumbles. Poor performance – well below market growth during recent quarters – has raised serious questions about the grip management has on operations, he said.
An incoming CEO faces a tough challenge. “Any leader will need to be extremely strong to grapple with the Gap culture of inertia and a general unwillingness to change and innovate.”
In a statement, Syngal put a positive spin on her departure: “Leading this great company and our 100,000-strong employees since 2020, through unprecedented challenges for our industry, and society, has been an immense honour,” she said.
“With an exceptional and industry-leading CEO for Old Navy now appointed, I am thankful to have the board’s support in stepping down, ushering in a new opportunity for a fresh perspective and rejuvenated leadership to carry Gap Inc forward.”