Connect with us

Business

Gap comparable sales surge after viral ‘Milkshake’ denim ad with Katseye

Published

on

Gap comparable sales surge after viral ‘Milkshake’ denim ad with Katseye


Shoppers walk past a GAP fashion retail store on Oxford Street on October 30, 2025 in London, United Kingdom.

John Keeble | Getty Images News | Getty Images

Apparel retailer Gap said Thursday its comparable sales rose 5% during the fiscal third quarter, driven by strong revenue at its namesake brand after its viral “Better in Denim” campaign with girl group Katseye. 

Putting aside pandemic-related spikes, the rise in comparable sales is the strongest growth for Gap since its fiscal 2017 holiday quarter and is well ahead of Wall Street expectations of 3.1%, according to StreetAccount. 

In an interview with CNBC, CEO Richard Dickson said the company hasn’t needed to discount as often to sell products, it’s winning customers from all income cohorts and it’s seeing a “great start” to the holiday shopping season. 

“While external data points to macro pressure, particularly on the low-income consumer, our customers are finding our price value, [and] our styles are breaking through the competitive landscape,” said Dickson. “Our product is resonating. So we’re very confident as we head into the holiday season.” 

Shares of Gap rose 5% in extended trading Thursday.

Here’s how the largest specialty apparel company in the U.S. performed during the quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

  • Earnings per share: 62 cents vs. 59 cents expected
  • Revenue: $3.94 billion vs. $3.91 billion expected

The company’s net income during the three months ended Nov. 1 declined nearly 14% to $236 million, or 62 cents per share, compared with $274 million, or 72 cents per share, a year earlier. 

Sales rose to $3.94 billion, up 3% from $3.83 billion a year earlier. 

For Gap’s fiscal year, which is slated to end around early February, the company is now guiding to the high end of its previously released sales forecast, expecting sales to rise between 1.7% and 2%, in line with analyst expectations. It previously expected sales to rise between 1% and 2%.

The company is now expecting its full-year operating margin to be around 7.2%, compared to its previous range of between 6.7% and 7%. The forecast includes the impact of tariffs, estimated to be between 1 and 1.1 percentage points. 

Comparable sales across Gap, which owns its namesake banner, Old Navy, Athleta and Banana Republic, have been positive now for seven straight quarters. Under Dickson, the company has been as focused on boosting profitability and fixing operations as it has been on reigniting cultural relevance, which has led to sustained sales growth across the portfolio. 

Gap’s profitability had been growing, too, as a result, but now that it’s facing tariffs, the retailer’s gross margin and net income are both taking a hit. During the quarter, Gap’s gross margin fell 0.3 percentage points to 42.4% but still came in higher than expectations of 41.2%, according to StreetAccount. 

The 14% decline in Gap’s net income was primarily related to tariffs, finance chief Katrina O’Connell said in an interview. 

Gap’s better-than-expected results come as apparel sales remain generally soft across the industry and consumers pull back on nice-to-have items like new clothes in favor of necessities.

Aside from clear value players like Walmart and TJX Companies, earnings so far this season have been muted, with some companies blaming macroeconomic conditions and expressing caution about the holiday season. 

Dickson said Gap’s varied portfolio gives it a hedge in uncertain economic times because it can capture shoppers in a variety of different places. 

“Our portfolio appeals to a wide range of consumers, which is giving us great flexibility in today’s environment,” said Dickson. 

Here’s a closer look at how each of the company’s brands performed:

Gap 

Gap’s namesake brand has been the focus of Dickson’s turnaround strategy since he took the helm as CEO just over two years ago.

During the quarter, comparable sales rose a staggering 7% – more than double the 3.2% gain analysts had expected, according to StreetAccount. Revenue rose 6% to $951 million.

During the quarter, Gap released its viral “Milkshake” campaign, featuring the early-aughts Kelis song and members of the Katseye pop group. The campaign helped sales, but Dickson said Gap brand’s growth is “a story about consistency” and a mix of better product, marketing and partnerships. 

Old Navy 

Sales at Old Navy, Gap’s largest brand by revenue, rose 5% to $2.3 billion with comparable sales up 6%, far better than the 3.8% that analysts surveyed by StreetAccount expected. The company said it saw growth in key categories like denim, activewear, kids and baby. 

Banana Republic 

The elevated, work-friendly brand is still in turnaround mode but saw sales grow 1% to $464 million during the quarter with comparable sales up 4%, better than the 3.2% gain analysts had expected, according to StreetAccount.

This was the second quarter in a row Banana reported positive comparable sales, which the company attributed to better marketing and product. 

Athleta 

Both revenue and comparable sales at Athleta were down a whopping 11% to $257 million, an eyesore on Gap’s otherwise better-than-expected results.

Dickson has repeatedly said Athleta is in a reset year, but how long that reset will take remains unclear.

“We have been disappointed in the trend. We understand there’s a lot of work to do, but I really do believe in the brand,” said Dickson. “I believe in the leadership and we will continue to build this brand for the long term. It does deserve it.”



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

Goldman Sachs is about to report fourth-quarter earnings — here’s what the Street expects

Published

on

Goldman Sachs is about to report fourth-quarter earnings — here’s what the Street expects


Goldman Sachs CEO David Solomon speaks during an interview at the Economic Club of Washington in Washington, D.C., U.S., Oct. 30, 2025.

Kevin Lamarque | Reuters

Goldman Sachs is scheduled to report fourth-quarter earnings before the opening bell Thursday.

Here’s what Wall Street expects:

  • Earnings: $11.67 per share, according to LSEG
  • Revenue: $13.79 billion, according to LSEG
  • Trading revenue: Fixed income of $2.93 billion, equities of $3.70 billion, per StreetAccount
  • Investing banking fees: $2.58 billion, per StreetAccount

Goldman Sachs is set up to be a beneficiary of several trends in the fourth quarter.

Trading desks across Wall Street have benefited in the last year as President Donald Trump’s policies have roiled markets for bonds, currencies, commodities and stocks.

For instance, rival JPMorgan Chase topped expectations for fourth-quarter results on equities and fixed income trading revenue that exceeded the StreetAccount estimate by a combined $460 million.

Global investment banking revenue in the quarter was 12% higher than a year ago, according to Dealogic, which should provide a boost to Goldman’s advisory business.  

The firm’s asset and wealth management division should also see gains as stock market levels remained buoyant in the quarter.

Finally, the bank said last week that its deal to offload its Apple Card business to JPMorgan would result in a 46-cents-per-share boost to quarterly results.

This story is developing. Please check back for updates.



Source link

Continue Reading

Business

After Backlash, Elon Musk Grok To Stop Creating Undressed Images Of Real People On X

Published

on

After Backlash, Elon Musk Grok To Stop Creating Undressed Images Of Real People On X


Last Updated:

X decision came after facing outrage over the misuse of Grok, where the AI Chatbot was found to be complying with user requests to digitally undress images of real people.

Elon Musk’s Grok can no longer undress images of real people on X. (Representative Image)

Elon Musk’s Grok can no longer undress images of real people on X. (Representative Image)

Amid the rising concerns over the sexualised AI deepfakes in countries including the UK and US, Elon Musk’s Grok artificial intelligence chatbot will no longer edit “images of real people in revealing clothing” on X, the company confirmed Wednesday evening.

The company’s decision came after facing global outrage over the misuse of Grok, where the AI Chatbot was found to be complying with user requests to digitally undress images of adults and, in some cases, children.

“We have implemented technological measures to prevent the Grok account from allowing the editing of images of real people in revealing clothing such as bikinis. This restriction applies to all users, including paid subscribers,” X wrote via its Safety team account.

Within the last week xAi, which owns both Grok and X, restricted image generation for Grok on X to paying X premium subscribers

CNN reported that it has been observed that in the last few days, Grok’s X account had modified how it responded in general to users’ image generation requests, even for those subscribed to X premium.

Click here to add News18 as your preferred news source on Google.

Follow News18 on Google. Join the fun, play games on News18. Stay updated with all the latest business news, including market trendsstock updatestax, IPO, banking finance, real estate, savings and investments. To Get in-depth analysis, expert opinions, and real-time updates. Also Download the News18 App to stay updated.
News business After Backlash, Elon Musk Grok To Stop Creating Undressed Images Of Real People On X
Disclaimer: Comments reflect users’ views, not News18’s. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.

Read More



Source link

Continue Reading

Business

Elon Musk’s X to block Grok from undressing images of real people

Published

on

Elon Musk’s X to block Grok from undressing images of real people


Elon Musk’s AI model Grok will no longer be able to edit photos of real people to show them in revealing clothing, after widespread concern over sexualised AI deepfakes in countries including the UK and US.

“We have implemented technological measures to prevent the Grok account from allowing the editing of images of real people in revealing clothing such as bikinis.

“This restriction applies to all users, including paid subscribers,” reads an announcement on X, which operates the Grok AI tool.

The change was announced hours after California’s top prosecutor said the state was probing the spread of sexualised AI deepfakes, including of children, generated by the AI model.

The update expands measures that stop all users, including paid subscribers, editing images of real people in revealing outfits.

X, formerly known as Twitter, also reiterated in a statement on Wednesday that only paid users will be able to edit images using Grok on its platform.

This will add an extra layer of protection by helping to ensure that those who try and abuse Grok to violate the law or X’s policies are held accountable, it said.

Users who try to generate images of real people in bikinis, underwear and similar clothing using Grok will be stopped from doing so according to the laws of their jurisdiction, X’s statement said.

In a statement on Wednesday, California Attorney General Rob Bonta said: “This material, which depicts women and children in nude and sexually explicit situations, has been used to harass people across the internet.”

Malaysia and Indonesia have blocked access to the chatbot over the images and UK Prime Minister Sir Keir Starmer warned X could lose the “right to self regulate” amid outrage over the AI images.

Britain’s media regulator, Ofcom, said on Monday that it would investigate whether X had failed to comply with UK law over the sexual images.



Source link

Continue Reading

Trending