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Aug 02
Gap Q2 2025 Earnings Report
Gap delivered solid Q2 2025 results with positive comparable sales and strong brand momentum across Old Navy, Gap, and Banana Republic.
Key Takeaways
Gap Inc. maintained flat sales YoY at $3.73B, while achieving its sixth straight quarter of positive comparable sales and exceeding profit expectations. Online sales grew and key brands performed well, though Athleta continued to face challenges.
Net sales were $3.73B, flat YoY, with online sales up 3% and representing 34% of total sales.
Comparable sales grew 1%, led by Old Navy (+2%), Gap (+4%), and Banana Republic (+4%).
EPS rose to $0.57, a 6% increase YoY, with net income at $216M.
Gap ended the quarter with 2,486 company-operated stores and 29.7M square feet.
Gap
Gap
Gap Revenue by Segment
Gap Revenue by Geographic Location
Revenue by Segment
Old Navy Global Revenue
CapyFin.comGap Global Revenue
CapyFin.comBanana Republic Global Revenue
CapyFin.comAthleta Global Revenue
CapyFin.comOther Revenue
CapyFin.comRevenue by Geographic Location
U.S. Revenue
CapyFin.comCanada Revenue
CapyFin.comOther regions Revenue
CapyFin.com Forward Guidance
Gap reaffirmed its FY25 outlook, projecting low single-digit net sales growth and margin pressures from tariffs in Q3.
Positive Outlook
- FY25 net sales expected to grow 1%–2%
- Operating margin outlook reaffirmed at 6.7%–7.0%
- Gap brand achieved 7th consecutive quarter of positive comps
- Strong performance from Old Navy and Banana Republic
- Technology investments to support long-term growth
Challenges Ahead
- Q3 gross margin expected to deleverage by 150–170 bps
- Athleta comparable sales declined 9%, sales down 11% YoY
- Inventory up 9% YoY due to tariffs and accelerated receipts
- Q3 operating expenses expected to slightly deleverage
- Tariff impacts estimated at 200 bps for Q3 gross margin
Revenue & Expenses
Visualization of income flow from segment revenue to net income