San Francisco apparel company, Gap Inc., is eliminating 500 corporate jobs in San Francisco, New York, and Asia as it aims to reduce expenses amid dwindling sales, particularly in its Old Navy stores, which experienced a steep decline in sales in 2022. The company also owns Banana Republic and Athleta.
The news comes after Kanye West terminated his partnership with the company following clashes over breached agreements between his company, Yeezy and Gap.
The company is laying off staff and eliminating positions currently open across a range of departments.
The Wall Street Journal first reported the news.
Shares of the Banana Republic parent declined about 3% in afternoon trade, taking the year-to-date decline to 48%.
Late last month, the company withdrew its annual forecasts due to an abundance of inventory and weak sales.
Gap is in the middle of a CEO transition after Sonia Syngal stepped down earlier this year, and is currently led on an interim basis by Executive Chairman Bob Martin.
The company had a workforce of about 97,000 employees as of Jan. 29, with around 9% of employees working at its headquarters locations, according to a regulatory filing.
The company posted a loss of $49 million over three months ending in July this year, according to Sfgate.
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“We’ve let our operating costs increase at a faster rate than our sales, and in turn our profitability,” the company’s interim chief executive Bob Martin wrote in a letter to employees this week, according the WSJ.
The news comes days after the company parted ways with Kanye West following a public spat over breached agreements in the partnership between his company Yeezy and Gap.
Founded in San Francisco in 1969 by the late Donald Fisher and Doris Fisher, the company is still largely in family hands, with Doris and sons Robert and William Fisher acting on the board of directors. (The other Fisher sibling, John, owns the Oakland Athletics but is not a Gap board member, per the company website.)
The company’s headquarters, at 2 Folsom St. on the Embarcadero in San Francisco, house approximately 4,000 employees, according to ZoomInfo. In August 2020, during the early months of the coronavirus pandemic, the company shuttered its flagship store at 890 Market St.
The news comes as a string of other retailers have cut their staffing including Walmart, Best Buy and Peloton. Home goods retailer Bed Bath & Beyond, based in Union, New Jersey, said earlier this month that it will close about 150 of its namesake stores and slash its workforce by 20%.
