Gap, Inc. (GPS) reported Q1 EPS of ($0.44), $0.33 worse than the analyst estimate of ($0.11). Revenue for the quarter came in at $3.5 billion versus the consensus estimate of $3.48 billion.
GUIDANCE:
Gap, Inc. sees FY2022 EPS of $0.30-$0.60, versus the consensus of $0.43.
- The company now expects fiscal 2022 revenue to decline in the low to mid-single digit range versus last year.
- Gross margin is expected to be in the range of 36.5% to 37.5%.
- Reported operating margin is expected to be in the range of 1.8%-2.8% with adjusted operating margin2 in the range of 1.5% to 2.5%.
- Reported diluted earnings per share is expected to be in the range of $0.40 to $0.70.
- Adjusted diluted earnings per share,2 excluding a net benefit expected from international initiatives, is expected to be in the range of $0.30 to $0.60.
- Net interest expense of approximately $80 million.
- Effective tax rate of approximately 27%.
- Capital expenditures of approximately $700 million.
- The company continues to expect to open about 30 to 40 stores each for Old Navy and Athleta in fiscal year 2022. As part of its 350-store closure plan, the company expects to close about 50 Gap and Banana Republic stores in North America during the year.