Gap Inc. is targeting Athleta as part of its growth strategy for 2023. The retail giant plans to double the sales of its Athleta business to $2 billion in the coming years as part of its ‘Power Plan 2023’. To achieve this goal, Gap intends to open around 100 Athleta stores in the US, in addition to its current 200 locations.

Mary Beth Laughton, President and CEO at Athleta, highlighted the profitability of the brand’s stores and the significant growth of its online business. Online sales now account for more than 50 percent of overall sales and are expanding at a double-digit rate. Currently, Athleta is Gap Inc.’s most profitable brand and the only one that experienced sales growth during the recent quarter.

In addition to its focus on Athleta, Gap Inc. aims to increase Old Navy’s sales to $10 billion by 2023, up from $8 billion in 2019. This will allow Old Navy and Athleta to make up around 70 percent of Gap Inc.’s sales by 2023, compared to 55 percent in 2019. To achieve this, Gap plans to reduce the footprint of Gap and Banana Republic by 30 percent, which will involve closing approximately 350 stores.

Earlier this week, Gap Inc. announced its plans to exit the European market and close its brick-and-mortar stores in France, the UK, Italy, and Ireland. A total of 129 Gap stores will be shuttered, with the closures expected to take place in Q2 2021. However, Gap Inc. will maintain a presence in Europe through franchise partnerships.

Gap Inc. anticipates its operating cash flow to reach at least 10 percent of sales by 2023, with a margin for earnings, before interest and taxes, of 10 percent or more. This demonstrates the company’s confidence in its future profitability and growth potential.

Overall, Gap Inc.’s focus on Athleta and Old Navy, as well as its strategic store closures and expansion plans, demonstrate its commitment to adapting and evolving in the challenging retail landscape. By leveraging the success of its most profitable brands and expanding its online presence, Gap Inc. aims to achieve profitable growth and solidify its position as a leading retailer.

Useful Links:
1. [Athleta Official Website](https://www.athleta.com/)
2. [Old Navy Official Website](https://oldnavy.gap.com/)