– Mind the Gap. During her nearly two-and-a-half years as CEO of Gap Inc., Sonia Syngal has navigated the aftermath of a canceled brand spinoff, the effects of the global pandemic on a retail workforce, and an ambitious—but ultimately unsuccessful—effort to change how American businesses sell plus-size clothing.

The consequences of that last effort, however, seem to have reached the top. Syngal is stepping down as CEO effective immediately, Gap Inc. announced yesterday. Her departure follows that of Old Navy CEO Nancy Green.

Syngal’s exit comes amid declining sales for the business, which earned $16 billion in revenue in 2021. In a financial update, Gap Inc. advised shareholders that it expected sales to decline in the “high single-digit range” this quarter. Its stock fell 4% on the news yesterday. Gap Inc.’s other brands include its namesake Gap brand, Banana Republic, and Athleta, a small but strong segment of the business.

While Gap Inc. has navigated the challenges facing most retail businesses, from inflation and supply chain issues to labor shortages, recent changes at Old Navy have been at the center of the company’s challenges. Green spearheaded a strategy to integrate plus sizes into the brand’s straight sizing on the store floors and behind the scenes—a bold move meant to meet the reality that most American women wear plus sizes. But in practice, the strategy left stores with too many small and large sizes and not enough items in the middle of the size range, leading to declining sales.

Photograph by Stuart Isett for Fortune

Syngal has strong ties to Old Navy; the 18-year Gap Inc. veteran ran the Old Navy business before she was promoted to her most recent CEO job. (For a look back at that period, read this profile Fortune senior writer Phil Wahba wrote about Syngal in 2019.) When she spoke at the Fortune Most Powerful Women Summit that year, she appeared on stage wearing nearly head-to-toe Old Navy.

“Leading this great company and our 100,000-strong employees since 2020, through unprecedented challenges for our industry, and society, has been an immense honor,” Syngal said in a statement yesterday. “Through it all, Gap Inc. and its dedicated teams have seized change as an opportunity, restructured for future growth, crystallized unique brand identities rooted in cultural relevance, and fiercely chased transformation.”

But Syngal’s and Green’s departures come with an unfortunate consequence: Gap Inc. will no longer be a woman-led business. Syngal’s successor is chairman Bob Martin, now serving as interim CEO. Green is set to be replaced by Horacio “Haio” Barbeito. Both are Walmart alumni; Martin, as CEO of Walmart International, and Barbeito as CEO of Walmart Canada.

Syngal’s departure leaves 43 female CEOs on the Fortune 500 and just a handful of women of color among that group. The retail industry tends to elevate women to CEO jobs more so than other categories in the Fortune 500. Syngal’s exit—not to mention the ongoing sale and activist shareholder sagas at CEO Michelle Gass’s Kohl’s—threatens to thin those ranks.

Emma Hinchliffe
emma.hinchliffe@fortune.com
@_emmahinchliffe

The Broadsheet is Fortune’s newsletter for and about the world’s most powerful women. Today’s edition was curated by Paige McGlauflin. Subscribe here.

ALSO IN THE HEADLINES

- Going corporate. Over 1 million women left the workforce between February 2020 and January 2022, with many leaving longtime gigs to start their own ventures. But some female entrepreneurs also used this time to reflect on their businesses and, ultimately, made the decision to return to the corporate world. “Going corporate doesn’t have to be negative and feel like you’re going back five years… if you can identify what you want, you can certainly get that on the other side as well,” said Michelle Wong, who became CMO of bakery chain Sprinkles in 2021. Glamour 

- Pro-business, pro-abortion. Democratic governors are encouraging business leaders in antiabortion states to consider moving their operations. While states like Texas that are known as business-friendly could withstand the ramifications, such as talent loss, those that lack such economic appeal would suffer from businesses pulling out of their jurisdictions. “An extreme response is not in the state’s competitive interest,” said Sandy Baruah, president of the Detroit Regional Chamber in Michigan, where Democratic Gov. Gretchen Whitmer is currently challenging a pre-Roe abortion ban. New York Times

- Production delays. Abbott Laboratories, the largest U.S. manufacturer of infant formula, finally reopened its Michigan plant on July 1 after closing for a second time due to severe flooding from storms. The plant was only open for two weeks in June following its first closure in February over formula contamination concerns. Its production problems have exacerbated a formula shortage that's affected American families for months. Bloomberg

MOVERS AND SHAKERS:  Former U.S. Secretary of State Condoleezza Rice has joined the new ownership group of the Denver Broncos. Shanique Bonelli-Moore has joined Clorox as its chief diversity and social impact officer. Alternative investment manager Energize Ventures has promoted Katie McClain to chief operating officer, Honour Masters joins as senior investment associate, and Hannah Magnuson joins as content marketing strategist. Northwestern University president Rebecca Blank resigned Monday, which was also her first day, due to a recent cancer diagnosis. Workforce solutions company Tandym Group has elected Syneos Health CEO Michelle Keefe to its board of directors.

IN CASE YOU MISSED IT

- OTC birth control. The FDA will consider authorizing a form of birth control pills for over-the-counter use. The contraceptive, referred to as the “mini-pill,” only contains the hormone progestin, different from the standard oral contraceptives in the U.S. that have a combination of progestin and estrogen. Currently, all oral contraceptives require prescriptions because of concern that estrogen can increase the risk of blood clots or stroke. The Verge

- Plea deal. Jennifer Shah, a cast member of the reality television series Real Housewives of Salt Lake City, pleaded guilty on Monday to conspiring to commit wire fraud. She was arrested and charged in 2021, accused of playing a key role in a telemarketing scheme defrauding hundreds of victims, some of whom were elderly. Shah faces 11 to 14 years in prison, and must pay $6.5 million in forfeiture and up to $9.5 million in restitution as part of the plea deal. CNN

- Prodigious achievement. Thirteen-year-old Alena Analeigh Wicker became the youngest Black person accepted to medical school in the U.S. Wicker is currently halfway through her undergraduate degree at Arizona State University and Oakwood University and hopes to achieve her medical degree from the University of Alabama’s Birmingham Heersink School of Medicine at the age of 18. She cited her interest in viral immunology as her reason to pursue medical school. Black Enterprise

ON MY RADAR

Can strippers really forecast a financial crisis? Glamour

Toxic and ineffective: experts warn against ‘herbal abortion’ remedies on TikTok New York Times

Lea Michele replaces Beanie Feldstein as Fanny Brice in Broadway’s Funny Girl Variety

Tosca Musk: how Elon and I overcame our difficult childhood The Times

PARTING WORDS

“What’s been interesting to watch and witness is just how easy it is for men to totally destroy a woman’s body, publicly, proudly, for everyone to see. You even do it with your job titles and work emails in your bio.”

-Actress Florence Pugh in response to sexist comments she received after wearing a sheer dress to Valentino’s show in Rome over the weekend.