Gap Reports Drop in March Sales, High Inventory Levels
Sales at stores open at least a year fell 6% in the five weeks ended April 2
The company on Thursday said sales at stores open at least a year fell 6% in the five weeks ended April 2, and it is entering April with more inventory than anticipated. The excess merchandise is expected to “pressure its gross margin rate” for the first quarter of the fiscal year, the retailer said.
The company released the news after markets closed. Shares, which fell 4% to $27.69 in 4 p.m. trading, fell as much as 10% in late trading. The stock has fallen about 35% over the past 12 months.
brought back former Banana Republic veteran Wendi Goldman last year to help with product design. As part of cost-cutting measures, the company has also slashed its workforce and closed dozens of stores.
“While March proved challenging, we remain focused on taking the necessary steps to improve results across the portfolio throughout the year,” the company’s finance chief, Sabrina Simmons, said in a news release.
Gap said it generated revenue of $1.43 billion in the five weeks ended April 2, compared with $1.53 billion in the same period a year earlier. Comparable sales declined 3% at the Gap brand, 14% at Banana Republic and 6% at Old Navy.
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