Gap Inc. shares tank as retailer misses earnings expectations, same-sale stores weaker
Shares of Gap Inc. fell more than 10% late Thursday after the retailer missed Wall Street's per-share earnings expectations and its same-store sales grew less than forecast. Gap said it earned $164 million, or 42 cents a share, in the first quarter, compared with $143 million, or 36 cents a share in the first quarter of fiscal 2017. Sales rose 10% to $3.78 billion, from $3.44 billion a year ago. Analysts polled by FactSet had expected earnings of 44 cents a share on sales of $3.61 billion for the quarter. Comparable-store sales rose 1% in the quarter as sales at Old Navy stores' lost steam, Gap stores' sales were flat, and Banana Republic stores' sales rose, Gap said. The analysts surveyed by FactSet had expected a 1.7% increase in overall same-store sales. The company reaffirmed its 2018 per-share earnings guidance in the range of $2.55 to $2.70 despite "the pressures we faced in the first quarter," Chief Financial Officer Teri List-Stoll said in a statement. That reflects the company's "confidence in the underlying fundamentals of the business as well as the benefits of executing against our balanced growth strategy," List-Stoll said. Comparable-store sales for 2018 are seen flat to up slightly, Gap said. Gap shares ended the regular trading session up 3.3%.
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