Gap reported flat net sales of $3.7bn in Q2 FY25, with a 1% YoY increase in comparable sales and a 1% decrease in store sales. Online sales rose by 3% to 34% of total net sales. Old Navy saw a 1% sales increase, while Banana Republic had $475m in net sales.

Despite a 140 basis point drop in gross margin to 41.2%, Gap achieved an operating income of $292m with a 7.8% margin and net income of $216m. The company projects a 1-2% net sales growth for FY25, with an operating margin between 6.7-7% and capital expenditures of $500-550m.

CEO Dickson highlighted Gap’s success in implementing a new strategy, resulting in positive comps for six consecutive quarters. The company is focused on building a high-performing, value-driven business while navigating challenges such as tariffs and store closures.

Read more at Yahoo Finance: Gap posts flat net sales in second quarter 2025