According to CNBC11 report 8, after the removal of Gap CEO pike, the company's plan to divest its former Old Navy brand has been questioned.

The San Francisco based clothing retailer announced last Thursday that pike had resigned from his position since 2015. Parker was temporarily replaced by Robert Fisher, the son of Gap founder Donald and Doris Fisher.

With the sudden departure of Parker, analysts suspect that the Old Navy and Gap will split up, especially the Old Navy brand is in such a bad state.

As of Friday morning, Gap shares fell by about 7%, down more than $450 million from Thursday. As of Thursday's close, the stock has fallen by nearly 30% this year. Gap's valuation is about $6 billion 320 million.

However, Gap said in an e-mail statement that its board of directors "still believes in the strategic basis of the plan, and the preparatory work is also proceeding according to plan."

The company also said it would hold regular Board meetings this week, and will provide updates on quarterly earnings in November 21st.

The company announced in February this year that it plans to split Gap into two listed companies, the Old Navy and Gap. The two companies are still headed by pike, and the company will include Banana Republic and sports brand Athleta and Hill City. The separation plan is scheduled to be completed next year.

It is reported that the Old Navy has been a star in Gap products, with annual sales of about $8 billion. It successfully provided basic clothing such as white T-shirts, jeans and logo hoodies at a lower price, and became competitive with businesses such as T.J. Maxx and Ross Stores.

But today's consumers are faced with numerous choices to find cheaper clothes on the Internet or fast fashion brands like H&M. H&M recently reported that its sales have resumed growth. The choice of second-hand store shopping and clothing leasing also affects clothing sales.

Gap said sales in the same quarter fell by 4% in the third quarter. "We have to believe that this new development will make the Old Navy separation plan extremely difficult," said Evercore ISI analyst sad in his client's report.

He added: "a skeptical market, without a leader and a clear transformation plan, will hardly accept Gap and the banana republic as a fundamental challenge."

Royal Bank of China capital market analyst Kate Fitzsimmons said, "with the departure of the CEO, although the Old Navy did not update the plan in 2020, we think the board of directors may reassess their choice."