Gap Inc’s chief executive Glenn Murphy will retire from the company early next year.
The announcement comes as the group reported that its sales rose by just 1% to $1.48bn (£914m) in September, compared to the same five week period in 2013. Murphy said the month had “proved more challenging than expected”.
GAP’s like-for-likes fell 5%, while Banana Repulic’s were flat and Old Navy’s grew 4%.
Art Peck, president of Gap Inc’s growth, innovation and digital division, has been selected by the board to succeed Murphy, effective from February 1, 2015.
In a statement, Gap said: “Following seven successful years in his role, Murphy made the personal decision to retire from the company at the end of the fiscal year, allowing for a smooth and seamless leadership transition.”
Peck, who joined Gap in 2005, is currently responsible for creating the company’s omnichannel and digital strategies.
Bobby Martin, lead independent director for Gap’s board of directors, said: “Art has created substantial value for the company over the past decade, and the board is confident he will further increase long-term returns for our shareholders.“
He added: “The Murphy era at Gap will be long remembered for successful global expansion, strategic investments in key growth areas, and the consistent shareholder returns that our management team delivered.”
Peck will join the board from February 1. Bob Fisher will become non-executive chairman of the board on the same date.