Victoria's Secret CEO Jan Singer has resigned amid a sales slump and competition from young companies challenging the brand's grip on the lingerie industry.
The Wall Street Journal first reported Singer's departure last week. Victoria's Secret parent company L Brands (LB) made it official during its quarterly earnings release. The stock plunged 14% in early trading Tuesday.
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John Mehas, now the president of Tory Burch, will take over as CEO of Victoria's Secret Lingerie early next year, the company said.
Sales at Victoria's Secret stores that have been open for at least a year dropped 6% last quarter. Victoria's Secret has close to 1,000 stores in the United States, many of them tied to struggling malls.
Last year, Victoria Secret's same-store sales in North America fell 8% in part because of the company's decision to stop selling swimwear and clothing in 2016.
"Our number one priority is improving performance at Victoria's Secret Lingerie and PINK," said Leslie Wexner, Chairman and CEO of L Brands. "We could not be more excited for [Mehas] to lead Victoria's Secret Lingerie to a new phase of success."
Singer took over in 2016 after a stint at Spanx. She worked at Nike (NKE) for more than a decade.
Victoria's Secret has been struggling to keep up with changing consumer tastes. Flashy fashion shows, push-up bras and celebrity models aren't drawing people in like they used to. Instead, women are clamoring for more products with a better fit.
Online stores like ThirdLove, Lively and True & Co. are using tech and harnessing data to offer custom sizes and new products.
In an earnings call Tuesday, L Brands CFO Stuart Burgdoerfer called the company's overall performance "unacceptable."
He said while sales at Bath and Body Works and international sales for Victoria's Secret and PINK were strong, domestic performance is hindering the company.
Burgdoerfer said there's "a lot of pressure" on Victoria's Secret's PINK line of apparel, which features "embellished bling" and lounge wear, that don't appeal to shoppers.
He also said that L Brands would return to selling swimwear in 2019, but he didn't specify under which brand.
Other parts of the L Brands business have been struggling. The company announced in September that it is closing Bendel's website and all 23 of its stores, including the store's iconic Fifth Avenue location in New York, in January 2019 because of sluggish sales.
A change in Victoria's Secret leadership may not be enough to convince experts that L Brands is turning itself around.
"Jan was not the problem," Jefferies analyst Randal Konik wrote last week following rumors of Singer's exit. "The real problem is the VS brand is not resonating with consumers, its pricing power is gone, its market share is under permanent attack, and the business is over-stored."