Gap President and CEO Art Peck will step down from his position and also from the retailer’s Board of Directors following a brief transition period. Non-Executive Chairman of the Board Robert J. Fisher will serve as Interim President and CEO while the company seeks someone to fill the role permanently, and Chair of the Compensation and Management Development Committee Bobby Martin will serve as Lead Independent Director.
Fisher is a retail veteran with over 35 years of experience, including as CEO of Walmart International and CIO of Walmart. He has served on the Board of Directors at Gap since 2002.
“As the Board evaluates potential successors, our focus will be on strong leadership candidates with operational excellence to drive greater efficiency, speed and profitability,” said Fisher in a statement. “In the meantime, we will continue to focus on leveraging the power of our brands and the talented teams that lead them to improve execution and better position the portfolio for growth.”
The C-level shakeup could impact Gap’s plans to separate into two separate public companies: Peck had been positioned to serve as the CEO of NewCo, which would retain the Gap, Athleta, Banana Republic, Intermix and Hill City brands following Old Navy’s spinoff as its own company. Old Navy has been the best-performing brand in the Gap portfolio, generating nearly $8 billion in annual revenue, compared to the $9 billion generated by the other brands combined.
Additionally, the news came alongside a poor Q3 2019 earnings report, with sales down 7% atGap, 3% at Banana Republic and 4% at Old Navy due to slow traffic and other pressures. While Gap’s results were similar to the same period last year, Banana Republic declined from 2% sales growth during the same quarter in 2018, and Old Navy dropped down from 4% sales growth.