The apparel retailer is eliminating about 500 corporate jobs, mostly at Gap’s offices in San Francisco, New York and Asia. The cuts, which include open positions, are occurring in various departments. The news was first reported by The Wall Street Journal.
“We’ve let our operating costs increase at a faster rate than our sales, and in turn our profitability,” Gap executive chairman and interim CEO Bob Martin wrote in a memo to employees notifying them of the job cuts, according to the Journal.
The cuts come as Gap is struggling with slumping sales, especially at its largest division, Old Navy. In its most recent quarter, Gap swung to a loss of $49 million and net sales fell 8% to $3.86 billion. Comparable sales fell 10%, with a 15% drop at Old Navy.
The company is also searching for a new CEO following the abrupt departureof Sonia Syngal in July. And most recently, Kanye West said he was terminating his contract with the retailer.