Gap reports mixed second quarter and decline in sales across all brands

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New York

Gap reported declining sales across all four of its brands – Gap, Old Navy, Banana Republic and Athleta – in the second quarter, noting continued uncertainty among consumers.

At its flagship Gap stores, sales were driven by “continued strength in the women’s category,” the company noted in its earnings statement, but that was “offset by strategic store closures in North America.”

Across its brands, the company reported an 11% decline in online sales versus store sales, which were down 7%.

The company said in the statement that its outlook considers “the continued uncertain consumer and macro environment.”

The brand’s earnings report comes as consumers have shifted some of their post-pandemic shopping to experiences rather than material goods, with retailers from Macy’s to Target and beyond reporting challenging environments for sales.

Gap’s net sales were $3.55 billion, a decrease of 8% compared to last year. Refinitiv analysts had predicted revenue of $3.57 billion.

Excluding the negative impact from selling Gap China to Baozun in January, shutting down Yeezy Gap, and headwinds from a stronger dollar, sales declined 4% at Gap.

Old Navy sales declined 6% compared to last year, Banana Republic sales were down 11% and Athleta decreased 1%.

Late last month, Gap named Richard Dickson, from toy giant Mattel, as its new CEO. This quarter’s results came out on his third official day, Dickinson said in the company’s earnings call.

Sales of the mall staple have been struggling for years. The decline is prompting the retailer to close 30% of its Gap and Banana Republic stores in North America by next year.


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