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Gap closes 350 stores as Old Navy weighs on sales
Gap said it closed 350 stores, and in the second quarter reported net sales down 2% despite profit that beat expectations.
Gap Inc. has completed a store closure program that shuttered 350 locations, but the company is still contending with a difficult cost and revenue mix, according to Yahoo Finance. On its second-quarter earnings call, Gap CEO Richard Dickson said the retailer exceeded profit expectations while net sales fell 2%. He also pointed to gross margin strength, attributing it to continued operational and financial rigor.
Dickson said the Gap brand delivered a 10% increase in comparable sales, while Banana Republic posted its fifth consecutive quarter of positive comps. He added that Athleta’s top line remained pressured, though inventory productivity showed encouraging improvements.
The company described Old Navy as the main drag on performance, citing seasonal categories that continued to weigh on results. Yahoo Finance also noted comments from a former Tory Burch executive, who argued that retail is moving toward experiential, personalized shopping rather than simply treating store closings as a crisis.