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earnings-results:-gap-sales-miss-estimates-due-to-pandemic-closures-and-restrictions
earnings-results:-gap-sales-miss-estimates-due-to-pandemic-closures-and-restrictions

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Earnings Results: Gap sales miss estimates due to pandemic closures and restrictions

Earnings Results


The GAP flagship store in San Francisco in August.


Getty Images

Gap Inc. late Thursday said its sales fell 5% in the quarter that included the holidays, citing international store closures and U.S. stay-at-home restrictions.

Gap
GPS,
-1.44%

said fourth-quarter revenue fell to $4.42 billion from $4.67 billion in the year-ago quarter. The San Francisco-based company swung to a profit, though, posting fourth-quarter net income of $234 million, or 61 cents a share, compared with a loss of $184 million, or 49 cents a share, in the year-ago period. Gap said its earnings included 45 cents a share for non-recurring tax benefits and 12 cents a share in impairment charges related to its Intermix business.

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Analysts polled by FactSet expected the retailer to report adjusted earnings of 19 cents a share on sales of $4.66 billion.

Gap Chief Executive Sonia Syngal said in a statement that the company managed to gain market share despite “one of the most difficult years” in its history, pointing to its $6 billion in online sales for the year, a 54% increase. Online sales represented 45% of total sales, up from 25% in 2019, the company said.

Results were mixed at Gap’s various brands: Net sales rose 5% at Old Navy and 29% at Athleta, while net sales fell 19% at Gap and 27% at Banana Republic. Same-store sales revenue increased 7% at Old Navy and 26% at Athleta, and decreased 6% at Gap and 22% at Banana Republic.

For the full year, Gap reported $13.8 billion in sales, down from $16.38 billion in 2019. The company lost $665 million in 2020, or $1.78 a share, compared with net income of $351 million, or 93 cents a share, in the previous year. Analysts had expected a loss of $2.21 a share on revenue of $14 billion.

Gap stock fell early in extended trading but was up nearly 2.5% at about 5 p.m. Eastern. They fell 1.75% in the regular session to close at $25.30.  Shares of Gap have gained about 75% in the past 12 months, compared with gains around 20% for the S&P 500 index
SPX,
-1.34%
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