Gap Inc.'s namesake brand is experiencing a renaissance, with investors growing optimistic about its turnaround. Shares surged 15% Friday to $23.95 after the company reported a 10% increase in same-store sales for the Gap brand in the most recent quarter, along with earnings that beat analyst estimates.

The brand, which dominated American fashion in the '90s and early 2000s under then-CEO Mickey Drexler, is regaining relevance through celebrity collaborations with Victoria Beckham and Hailey Biever, as well as designs by creative director Zac Posen showcased at events like the Met Gala and Oscars. CEO Richard Dickson, who took over in August 2023, has revitalized the brand with trendier products and sharper marketing, leading to 11 consecutive quarters of same-store sales growth.

However, Gap's other divisions have struggled. Old Navy, the largest division, saw same-store sales drop 4%, with CEO Dickson citing missteps in summer categories and marketing. Athleta's same-store sales fell 12% amid increased competition. Overall company revenue declined 2% to $3.65 billion compared to the prior year. Old Navy President Haio Barbeito will transition to an advisory role on Nov. 2, replaced by Michael Francis.