Gap Inc. reportedly to cut hundreds more corporate jobs

Gap Inc. apparently isn’t done with reducing its global headcount.

The apparel retailer is laying off more than 500 employees across its global corporate workforce as it looks to cut costs and move back to profitability, reported the Wall Street Journal.

The new round of cuts is expected to be larger than the approximate 500 corporate jobs Gap eliminated in September.

“Our goal is to flatten the organization, increase spans of control to create more robust roles and individual empowerment, and decrease layers to remove bottlenecks and make better, faster decisions,” Gap chairman and interim CEO Bob Martin told employees in a memo last week as reported by CNBC. 

Martin was named interim chief following the abrupt departure of Sonia Syngal in July 2022.  

The cuts come as Gap continues to struggle with slumping sales. In March, the retailer reported a fourth-quarter net loss of $273 million compared to a loss of $16 million in the year- earlier period. Revenue fell 6% to $4.24 billion.

In its fourth-quarter earnings release, Gap said it would be “decreasing management layers to improve quality and speed of decision making” and taking other actions to simplify operations. 

In the release, the company also announced the departure of Mary Beth Laughton, president and CEO of Athleta, and said it was eliminating the role of chief growth officer held by Asheesh Saksena. In addition, Sheila Peters, chief people officer, will leave the company at the end of the year.    

For fiscal 2023, Gap anticipates net sales could decrease in the low- to mid- single-digit range compared to last year’s net sales of $15.6 billion. Fiscal 2023 will include a 53rd week estimated to positively impact net sales by $150 million.

“While we are better positioned as we enter fiscal 2023, we continue to take a prudent approach to planning and managing our business in light of the continued uncertain consumer and macro environment,” said Katrina O’Connell, executive VP and CFO, Gap Inc. “We are confident that our continued actions to further optimize our operating model and cost structure are key steps toward positioning Gap Inc. back on its path towards sustainable, profitable growth and delivering value for our shareholders over the long term.”