Old Navy buoys Gap in second quarter
Although same-store sales at Gap were flat in the second quarter, the company reported a better-than-expected quarterly profit, buoyed by strong sales at Old Navy, and raised its full-year profit forecast as a result.
Net profit rose to $332 million in the quarter from $303 million a year ago.
Revenue increased 3% to $3.98 billion. Online net sales increased 11% to $515 million, on top of last year’s 27% increase. The company noted it continues to advance its successful omnichannel platform with the expansion of its reserve in store service to all U.S. Gap stores. The company also launched its order-in-store pilot, with plans to roll out the service to select U.S. Gap, Banana Republic, Old Navy and Athleta stores later this year.
Gap also plans to expand its reach to India through 40 franchise-operated stores. The retailer is partnering with Arvind Lifestyle Brand Limited, a subsidiary of Arvind Limited, which is one of India’s largest textile companies.
“India is an emerging, vibrant market and an important next step in our global expansion strategy,” said Steve Sunnucks, global president of Gap.