Gap blows pasts earnings estimates, raises guidance as all four brands post sales growth

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Gap has been in the midst of a turnaround under CEO Richard Dickson, who has focused on better marketing and storytelling for the company’s portfolio of…

Gap beat quarterly estimates on the top and bottom lines, leading it to raise its full-year guidance.

The company's reported net income for the three-month period that ended May 4 was $158 million, or 41 cents per share, compared with a loss of $18 million, or 5 cents per share, a year earlier.It's"the first time that all four brands have reflected positive comps in many years. In fact, we were sort of looking for when they had and it was difficult to find," CEO Richard Dickson told CNBC in an interview.

The biggest change to Gap's forecast is in its operating income outlook. It now expects operating income to be in the mid-40% growth range, compared to previous guidance of low-to-mid teens growth. He told CNBC the quarter's success was driven"by consistency and financial and operational rigor," adding the company's average selling prices are back to pre-pandemic levels thanks to leaner inventory levels that are leading to better sell throughs. But with better designs and marketing, consumers are just buying more, too.Old Navy: Net sales of $1.9 billion were up 5% compared to last year while comparable sales were up 3%, worse than the 4.9% uptick analysts had expected.

 

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Gap blows pasts earnings estimates, raises guidance as all four brands post sales growthGap has been in the midst of a turnaround under CEO Richard Dickson, who has focused on better marketing and storytelling for the company’s portfolio of…
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