Retail

Gap (GPS) Still Drowning

Angrybear_3Gap’s (GPS) earnings got a bit better, but the company is still coming apart at the seams.

In the latest quarter, Gap revenue fell from $3.69 billion to $3.5 billion. Comparable store sales were off 10%.  The companys online sales for the second quarter increased 11% to $191 million, compared with $172 million for the second quarter of last year.

Gap’s Old Navy brand is badly broken. Comparable store sales for that division were down 16%. Revenue for Old Navy fell from $1.5 billion to $1.3 billion. The operation still has over 1,000 stores and its is difficult to see how Gap can ever make money on them.

Net earnings at Gap made a modest comeback. They rose to $229 million in the quarter ending August 2 compared to $158 million last year. Based on sales by brand, that profit probably came from international, online, Gap North America, and Banana Republic North America.

That left Old Navy in the dust.

Douglas A. McIntyre

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