Mall retail giant closes stores, then admits business mistakes

Mall retail giant closes stores, then admits business mistakes
Mall retail giant closes stores, then admits business mistakes

The largest specialty apparel company in the U.S. has enjoyed success since launching as a jeans retailer in 1969.

Rock and roll radio commercials of the mid-1970s featured the successful Gap chain that sold Levi’s, vinyl records, and tapes (probably 8-tracks and cassettes) to young Americans.

My memory of that time is the clothing chain’s radio jingle, “Fall into The Gap.”

Gap later launched its sister specialty clothing chain, Old Navy, in 1994, which was so popular that it was the first retailer to reach $1 billion in annual sales in less than four years after its launch.

Old Navy is still doing well, but it sometimes needs to close underperforming stores.

The Gap Inc. closes Old Navy stores in Pennsylvania and New York.Reuters Connect/USA Today

Old Navy closes store in Pennsylvania

Retail giant The Gap Inc. will permanently close its Old Navy store at the Logan Valley shopping center in Altoona, Pennsylvania, on June 23, according to WTAJ-TV.

The retail chain did not give a specific reason for closing the store and did not disclose the number of employees affected by the closure.

Customers can still visit their nearest Old Navy store in State College, Pennsylvania, the company said in a note posted outside the store.

Queens store also closes

The closure of the Altoona store comes five months after The Gap closed its Old Navy store at 48th Street and Northern Boulevard in Queens, New York, with a similar notice on Jan. 22, the Queen’s Gazette posted on Facebook.

The retail chain also did not indicate the reason for the closure of the Queens store.

The Gap Inc. operates 3,477 stores under the Old Navy, Gap, Banana Republic and Athleta brands in 35 countries.

About 2,477 stores are company-operated units, with 1,241 Old Navy locations in the portfolio, according to a Gap statement in its earnings report.

Disappointing seasonal clothing business

While The Gap did not say why it closed Old Navy stores in Pennsylvania and New York, the specialty clothing chain said it began the year with disappointing results from its women’s seasonal dresses business, despite reporting a 1% increase in comp sales in its first quarter of 2026, during its earnings call on May 28.

“Overall, Old Navy’s results were primarily impacted by the women’s apparel business, where in reviewing the season, we didn’t execute as effectively and as a result, customers didn’t respond to our assortment the way we had anticipated,” The Gap Inc. CEO Richard Dickson said on the earnings conference call.

“As we enter the second quarter, the women’s seasonal dresses business continues to underperform our expectations, with weakness also visible across the broader range of seasonal products,” Dickson said.

The chain reorients its strategy

Old Navy refocused on sharper pricing and stronger messaging to customers to turn around seasonal category performance, Dickson said. The company saw some improvements in mid-May, is monitoring progress and continues to make adjustments.

“While we are encouraged by the recent improvement, we also recognize that this level of performance does not reflect our full potential,” Dickson said.

“There is a clear opportunity to do better. And we are working closely with the team to sharpen our approach and strengthen execution,” he said.

Gap closes store in Oakland

The Gap Inc. will also close a store in its Gap chain when it closes its Lakeshore Avenue location in Oakland, California, in the summer of 2026, when its lease expires, according to KGO-TV.

Gap did not indicate a specific reason for closing the store, which had been in operation for about 26 years. It also did not disclose the number of employees affected by the closure, but said workers will have the opportunity to relocate to nearby locations.

Related: 47-year-old high-end steakhouse chain closes 80 locations

This story was originally published by TheStreet on May 30, 2026, where it first appeared in the Retail section. Add TheStreet as a preferred source by clicking here.

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