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GAP Q1 Earnings Highlights

$GPS (+2.18%)


๐Ÿ”น Revenue: $3.5B (Est. $3.42B) ๐ŸŸข +2% YoY

๐Ÿ”น EPS: $0.51 (Est. $0.45) ๐ŸŸข

๐Ÿ”น Comparable Sales: +2% (Est. +1.6%) ๐ŸŸข


Tariff Impact:

๐Ÿ”ธ Minimal in Q2.

๐Ÿ”ธ FY gross impact of $250Mโ€“$300M if tariffs stay; after mitigation, net ~$100Mโ€“$150M weighted to H2.


FY Outlook

๐Ÿ”น Revenue: +1% to +2% (vs. $15.1B in FY24)

๐Ÿ”น Operating Income: +8% to +10% (vs. $1.1B in FY24)

๐Ÿ”น Net Interest Income: ~$15M

๐Ÿ”น Effective Tax Rate: ~26%

๐Ÿ”น CapEx: ~$600M

๐Ÿ”น Net Store Closures: ~35


Q2 Outlook

๐Ÿ”น Revenue: Flat YoY

๐Ÿ”น Gross Margin: Similar to Q1 (41.8%)

๐Ÿ”น Operating Expense (% of Sales): Slight leverage YoY


Brand-Level Comparable Sales (Q1 FY25)

๐Ÿ”น Old Navy: +3% (9th straight quarter of share gains)

๐Ÿ”น Gap: +5% (6th straight positive comps, 8th quarter share gain)

๐Ÿ”น Banana Republic: Flat (Net sales -3%)

๐Ÿ”น Athleta: -8% (Net sales -6%)


Other Q1 Metrics:

๐Ÿ”น Gross Margin: 41.8% (+60 bps YoY)=

๐Ÿ”น Online Sales: +6% YoY; 39% of total sales

๐Ÿ”น Store Sales: Flat YoY; 2,496 company-operated out of ~3,500 total stores=

๐Ÿ”น Inventory: $2.1B (+7% YoY)

๐Ÿ”น Cash & Short-Term Investments: $2.2B (+28% YoY)

๐Ÿ”น Free Cash Flow: -$223M

๐Ÿ”น Shareholder Return: $131M via dividends and buybacks

๐Ÿ”น Shares Repurchased: 4M for $70M

๐Ÿ”น Dividend: $0.165/share approved for Q2


CEO Commentary

๐Ÿ”ธ "Exceeded expectations. Positive comps for the 5th straight quarter. Brand reinvigoration is working. Staying focused on controllables for long-term growth." โ€“ Richard Dickson, CEO

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