Gap Tops Third-Quarter Expectations

Gap (NYSE: GAP) reported positive third-quarter earnings on Thursday but presented a cautious forecast for the holiday season. The company’s shares rose about 8% during extended trading amid the news.

The American clothing and accessories retailer reported earnings of USD0.77 per share. Revenue amounted to USD4.04 Billion, higher than analysts anticipated USD3.8 Billion. Wall Street had predicted that Gap would break even on a per-share basis.

“I have deep conviction that we have a portfolio of iconic brands that our customers love, increased confidence in our platform to drive leverage and economies of scale, and belief in the team’s ability to deliver. We have sharpened our focus on execution to optimize profitability and cash flow, are bringing more rigor to our operations, and balancing our assortments in response to what our customers are telling us. While our efforts show early signs of improvement, we are clear that there is work to be done to deliver what our customers, employees, and shareholders expect from Gap Inc.” said Bob Martin, Executive Chairman and Interim CEO, Gap Inc.

The company withdrew its full-year guidance in August after sharing it was struggling with increasing inflation and lower consumer sentiment. Furthermore, it is also dealing with replacing former CEO Sonia Syngal as well as the recently parting ways with Ye’s Yeezy brand.

Gap’s shares have tumbled 27% throughout the year and have a current market cap of USD4.86 Billion.