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Gap is expanding its push into beauty and accessories with products hitting company stores this spring as it battles fierce competition and works to regain cultural relevance in an already challenging economy.
Gap Inc. CEO Richard Dickson, a former Mattel executive who took the helm in 2023 to revive the company after it suffered years of weak sales, told FOX Business that its customers resonated with the beauty category, calling it a “meaningful opportunity” for the retailer to expand its brands – Gap, Banana Republic, Old Navy and Athleta – into beauty.
The company has already launched Old Navy’s Beauty Collection across 150 stores, some of which have dedicated shop-in-shops and beauty associates, Dickson said. More Gap products will be coming as soon as spring 2026, he added.
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“It is a highly competitive category, but it’s also one of the most resilient in retail – in fact, the fastest-growing and most resilient retail category in the U.S. So again, a clear and meaningful opportunity for us to expand,” Dickson told FOX Business. “We’ve got exceptional leadership and a thoughtful plan ahead.”
Gap announced its strategic expansion of both the beauty and accessories categories in September. (Gap Inc. )
Gap announced its strategic expansion of both the beauty and accessories categories in September and appointed several heavy hitters in the industry to lead the charge. For instance, it tapped longtime Estée Lauder executive John Demsey, who oversaw global brands including Tom Ford Beauty and MAC Cosmetics, to become executive director of beauty. Deb Redmond, a former Nordstrom senior vice president and division merchandise manager for beauty, was also brought on to become Gap’s general manager of beauty.
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“They’re really advancing our strategy, product development, customer experience and go-to-market execution across the portfolio,” Dickson said.
The company has already made significant progress in its turnaround under Dickson, who is best known for revitalizing the Barbie brand during his time at Mattel.
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Richard Dickson at the 2024 CFDA Fashion Awards held at the American Museum of Natural History on Oct. 28, 2024, in New York. (John Nacion/Variety via Getty Images)
While there is still a ways to go in Gap Inc.’s turnaround, sales and profit margins were better than expected in its latest quarter, causing the retail behemoth to raise its forecast for both full-year sales and profit margins.
The three-month period also marked the seventh consecutive quarter where sales grew compared with the same period a year ago. Dickson noted that its biggest brands, Old Navy, Gap, and Banana Republic, had higher sales in the quarter, and that it gained share across all income groups.
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“The strength of our third quarter and quarter-to-date performance positions us well for the holiday selling season and gives us the confidence to increase our full year net sales outlook to the high end of our prior guidance range and raise our full year operating margin outlook,” Dickson said in an earnings release. “We are focused on executing with excellence and finishing the year strong.”
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| GAP | GAP INC. | 25.06 | +2.00 | +8.67% |
This is an about-face from before Dickson took the reins in 2023. Not only did the company experience multiple quarters of declining sales and weak same-store growth, but it experienced frequent CEO turnover in the years, too.