Gap CEO Sonia Syngal to step down amid weak sales

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NEW YORK (AP) — Gap Inc. has announced that its CEO and president Sonia Syngal is stepping down from her role after two years on the job, effective immediately.

The move, announced Monday, comes as the San Francisco-based clothing company, which operates stores under its namesake, Old Navy, Banana Republic and Athleta, struggles with slumping sales and supply chain challenges.

Syngal, who has been with the company since 2004 including a stint as CEO of Old Navy, will stay on for a brief transition period. Effective immediately, Bob Martin, the company’s current executive chairman and a 40-year industry veteran, will serve as Gap Inc. president and CEO on an interim basis. Mayo Shattuck will continue to serve as lead independent director.

“While a search is underway, the board has complete confidence in the formidable leadership team to guide the company through this transition," said Martin in a statement.

Gap also announced that Horacio Barbeito will join the retailer as Old Navy president and CEO on Aug. 1. He succeeds Nancy Green who left the role in April. Barbeito most recently served as president and CEO of Walmart Canada.

The company said it expects net sales in the fiscal second quarter to decline roughly in the high-single digit range, relatively in line with its prior expectations. The company is expected to report final second-quarter financial results on Aug. 25.

Gap said it continues to navigate high costs in transportation and raw materials that are putting a dent in profit margins. In addition, it has taken a more aggressive approach in discounting, which should also have a negative impact on profits.

Shares fell nearly 3%, or 26 cents, to $8.50 in after hours trading after falling nearly 2%, or 14 cents, to close at $8.76 on Monday.