Old Navy CEO change puts Michael Francis in line to lead Gap Inc.’s biggest brand by quarterly sales after a 4% second-quarter decline. The transition, effective Nov. 2, comes as Gap adjusts merchandise, pricing, marketing and customer experience. The report examines the numbers behind the move and the strategy Francis will inherit.
Key Takeaways
- Francis is scheduled to become Old Navy president and CEO on Nov. 2, 2026, while Barbeito shifts to an advisory role
- Old Navy posted $2.1 billion in second-quarter net sales, down 4%, while comparable sales also fell 4%
- Gap lowered its full-year Old Navy comparable-sales outlook to flat to down 1%, from a previous range of flat to up 1%
- Francis is expected to focus on brand storytelling, omnichannel customer experience and in-store execution
- Old Navy Beauty Co. launched online and in 500 U.S. stores on Aug. 26, with a wider rollout planned by the end of September
Gap Inc. announced Aug. 27 that Francis will become president and chief executive officer of Old Navy on Nov. 2, succeeding Haio Barbeito, who will move into an advisory role. The appointment was disclosed the same day Gap reported fiscal second-quarter results showing Old Navy net sales of $2.1 billion, down 4% from a year earlier, with comparable sales also down 4%.
The timing puts the leadership transition directly alongside a weaker quarter for the brand. Gap Inc. CEO Richard Dickson said, “We have work to do at Old Navy, but we have a clear understanding of the factors that impacted performance.”
Old Navy CEO Change Follows a 4% Sales Decline
Old Navy’s second-quarter decline carried added weight because the brand produced more than half of Gap Inc.’s $3.7 billion in quarterly net sales. Gap Inc. overall reported net sales down 2% and comparable sales down 1% for the quarter ended Aug. 1.
Performance across the portfolio was mixed. The Gap brand reported a 10% comparable-sales increase, Banana Republic rose 3%, and Athleta fell 12%. Old Navy’s 4% comparable-sales decline therefore stood in contrast with stronger results at Gap and Banana Republic, while Athleta recorded the largest comparable-sales decline among the four brands.
Gap attributed Old Navy’s quarter to expected pressure in women’s seasonal merchandise and an unanticipated slowdown in traffic. The company also said higher promotional activity at Old Navy partially offset merchandise-margin strength elsewhere in the portfolio. Those factors put assortment, pricing, promotion and customer traffic at the center of the operating challenge Francis will inherit.
The leadership shift also comes as other major U.S. retailers use executive changes alongside operational resets. Target’s retail turnaround plans have similarly placed merchandising, store operations and customer experience among the areas receiving greater management attention, although Old Navy’s circumstances remain specific to Gap Inc.
Gap also revised its outlook after the quarter. The company now expects Old Navy comparable sales for fiscal 2026 to range from flat to down 1%, compared with its earlier forecast of flat to up 1%. The company said the change reflects Old Navy’s second-quarter performance.
Michael Francis Moves From Marketing Into the CEO Role
Francis joined Gap Inc. in March 2026 as chief customer officer for Old Navy and head of marketing shared services for the parent company. Gap publicly announced his customer-focused appointment in May, giving him several months inside the organization before naming him CEO.
His background includes 26 years at Target, where he served for more than a decade as executive vice president and chief marketing officer. He also served as president of JCPenney, held a senior brand position at DreamWorks Animation and advised Walmart on brand strategy, customer engagement and business transformation, according to Gap.
The move from customer and marketing leadership into the top operating role broadens Francis’s responsibilities beyond communications. Gap said his CEO priorities will include strengthening storytelling across commercial and marketing channels, improving the omnichannel customer experience, elevating in-store execution and deepening Old Navy’s connection with families.
That expanded remit places store-level execution closer to the center of his role. Other retail operating leadership appointments have also linked senior executive responsibilities with store operations and broader business performance.
Barbeito will remain involved as an adviser after leaving the operating role. Gap credited his tenure with strengthening Old Navy’s foundation and expanding strategic categories. The company described Francis’s appointment as a continuation of the transformation already underway rather than announcing a replacement of the broader strategy.
Gap Is Testing Product, Pricing and Customer Experience Changes
The financial update accompanying the CEO announcement provided the clearest outline of the work ahead. Old Navy’s second-quarter weakness followed an earlier warning sign in women’s merchandise. In the first quarter, the brand reported a weaker customer response to women’s dresses even as denim, activewear and children’s categories performed better.
By the second quarter, Gap said pressure in women’s seasonal merchandise had been joined by an unexpected slowdown in traffic. Higher promotional activity at Old Navy also partially offset merchandise-margin improvement elsewhere in the company, indicating that product selection and pricing remained connected to the brand’s performance.
Old Navy has simultaneously expanded its assortment and marketing activity. On Aug. 26, the company launched Old Navy Beauty Co. online and in 500 U.S. stores, with plans to expand the experience nationwide by the end of September. The assortment combines Old Navy-branded body care with a curated selection of outside beauty products.
The launch followed another fall marketing move. Old Navy introduced a denim campaign featuring Cardi B on Aug. 5, adding a major seasonal campaign before the CEO transition was announced. Gap has not yet reported financial results showing whether the fall marketing or beauty expansion has changed the sales and traffic trends identified during the second quarter.
Francis is therefore set to inherit both an existing operating plan and measurable areas of pressure. His stated priorities overlap with several issues already identified by Gap, including customer engagement, store experience and commercial storytelling.
When Francis starts Nov. 2, the latest disclosed benchmarks will include Old Navy’s 4% second-quarter comparable-sales decline and Gap’s fiscal 2026 forecast of flat to down 1% comparable sales for the brand, unless the company reports newer results before his start date. The Old Navy CEO change begins while Gap is already adjusting merchandise, marketing, pricing and customer experience rather than starting from a blank operating plan.
Frequently Asked Questions
Who is the new CEO of Old Navy?
Michael Francis is scheduled to become president and CEO of Old Navy. Gap Inc. announced the appointment on Aug. 27, 2026, after Francis had already been working in a customer and marketing leadership role within the company.
When does Michael Francis become CEO?
Francis is expected to begin the role on Nov. 2, 2026. Haio Barbeito will transition from the operating position into an advisory capacity.
Why is Old Navy changing CEOs?
Gap announced the Old Navy CEO change alongside its second-quarter results, but the company did not state that the 4% sales decline caused the leadership transition. Gap said Francis will continue work already underway while assuming broader operating responsibility.
How did Old Navy perform in the second quarter of fiscal 2026?
Old Navy reported $2.1 billion in net sales, down 4% from the prior year. Comparable sales also declined 4%, with Gap citing pressure in women’s seasonal merchandise and an unexpected slowdown in traffic.
What will Michael Francis focus on at Old Navy?
Gap said Francis will focus on commercial and marketing storytelling, the omnichannel customer experience, in-store execution and connections with the brand’s family customers. Those responsibilities expand on his earlier position as Old Navy’s chief customer officer.
