During a recent appearance on CNBC's 'Mad Money', Gap Inc CEO Richard Dickson discussed the ongoing challenges facing Athleta, the company's activewear brand, which saw first-quarter sales drop to $270 million, a 12% decline year-over-year. Comparable sales also fell by 11%, and management indicated that the second quarter is likely to mirror these disappointing results.
Despite these setbacks, Dickson emphasized the importance of Athleta within Gap's portfolio and highlighted the leadership of CEO Maggie Gauger, who has been implementing changes aimed at revitalizing the brand. He noted improvements in product assortment and margins, suggesting that new merchandise is beginning to resonate with consumers.
However, the overall performance of Gap was negatively impacted by Old Navy's weaker-than-expected results, leading to a 17% drop in Gap's stock price. Dickson expressed confidence in a gradual recovery for Athleta, projecting slight improvements in the latter half of the year as the company continues to refine its strategy and product offerings