The troubled retailer said its online growth "leaves us well-positioned to fuel our brands going forward" but its shares sank 5.5%.
“The work we’ve done to prepare for the spin shone a bright light on operational inefficiencies and areas for improvement.”
“We are not pleased with the third-quarter results and are focused on aggressively addressing operational issues," the struggling retailer says.
The surprise resignation of CEO Art Peck has Wall Street "wondering whether the split could be delayed or abandoned altogether."
"It’s clear that Old Navy’s business model and customers have increasingly diverged from our specialty brands over time."
The retailer plans to focus on the "healthy core" of Gap specialty stores while exiting "those that do not fit the future vision quickly.”
The retailer affirmed full-year guidance and plans to open 60 Old Navy stores by the end of the year.
The Gap announced it was closing 75 stores, including Old Navy Japan, as sales continue to plunge and profits dwindle.
The company estimates roughly $300 million in annualized sales losses associated with the store closures.
