Key takeaways:
- Old Navy is launching Old Navy Sport, a dedicated activewear sub-brand with shop-in-shop locations at 42 stores and its own social media handle.
- The launch follows a second quarter in which Old Navy’s comparable sales fell 4%, the brand’s first negative quarter in six quarters.
- Gap Inc. is banking on active, denim and a leadership change at Old Navy to drive a turnaround in the back half of fiscal 2026.
Old Navy is giving its activewear a new name and a new home. The brand announced Old Navy Sport on September 15, a sub-brand designed to consolidate and elevate its active assortment under a single identity, according to a press release from parent company Gap Inc.
The launch comes as Old Navy works to recover from a rocky second quarter, when comparable sales dropped 4%, the brand’s first decline in six quarters.
Old Navy Sport pulls together the brand’s activewear franchises into one destination spanning OldNavy.com, the Old Navy app, stores nationwide and a new @OldNavySport social media handle. Forty-two select stores will also feature “immersive” shop-in-shop environments built around the new brand.
The assortment includes “refreshed seasonal styles, updated colors and modern silhouettes” across many of Old Navy’s existing activewear lines. The company describes the line as blending “technical features with trend-right design.”
Old Navy currently ranks fifth in the U.S. active market, according to Circana data cited in the release.
“Old Navy Sport gives us an exciting opportunity to push the category forward with even more focus and innovation,” said Jessica Shynn, VP of Merchandising for Old Navy Sport, in a statement. “We’re bringing together trend-forward design, performance-driven details, and the value our customers expect from Old Navy to create a destination that makes it easy to move with confidence, wherever life takes you.”
Why Is Old Navy Investing in Activewear Right Now?
Gap Inc. CEO Richard Dickson shared that Old Navy Sport was on its way on the company’s Q2 earnings call.
“Old Navy had six consecutive quarters of positive comps leading up to this quarter,” Dickson said. “Certainly, the quarter wasn’t necessarily where we wanted it to be, but as I’ve shared and we’ve diagnosed, we missed the mark on our summer seasonal assortment, which we also previewed last quarter. In addition, we’ve also mentioned that our marketing fell short driving traffic.”
Old Navy Sport is one piece of a broader reset at the brand. Gap Inc. also rolled out Old Navy Beauty Co. nationwide this month and plans to launch a licensed sports merchandise partnership with Fanatics next month, timed to football season.
On the marketing side, Old Navy has leaned on celebrity and influencer partnerships to rebuild traffic, including a fall denim campaign featuring Cardi B that Dickson called “our most viewed campaign in Old Navy’s history,” along with a back-to-school content series with creator MrBeast.
The brand is also getting new leadership. Gap Inc. announced during the earnings call that Michael Francis will become Old Navy’s Brand President and CEO effective November 2, succeeding Horacio Barbeito, who will move into an advisory role during the transition. Dickson credited Francis, who joined in May, with already shaping the fall plan. “He’s already had meaningful impact, including sharpening our product storytelling,” Dickson said. “The marketing execution you see happening right now, he’s had a handprint on.”
What’s Gap Inc.’s Outlook for the Rest of the Year?
Gap Inc. narrowed its full-year revenue outlook to net sales growth of 1% to 1.5% following the second-quarter miss, while raising its adjusted operating margin and earnings-per-share guidance. The company now expects adjusted earnings per share of $2.35 to $2.45, up ten percent to 15% from last year.
By brand, the outlook is uneven. CFO Katrina O’Connell told analysts that Old Navy’s comparable sales are now expected to be flat to down 1% for the year, with “sequential improvement in the second half as our targeted actions take hold.” Gap brand, by contrast, is expected to post comp growth in the high single to low double digits after ten straight quarters, soon to be eleven, of positive comps. Banana Republic is projected to grow in the low single digits, marking a fifth consecutive quarter of gains, while Athleta’s turnaround remains in earlier stages, with comparable sales down twelve percent in the second quarter.
For Old Navy specifically, O’Connell said the third quarter is off to a better start. “Current trends are in line with the range, reflecting meaningful sequential improvement to our second quarter performance as the impact of the challenged summer seasonal product abates and new fall marketing and product resonates more strongly.”
