Gap key revenue metric up 4 percent in October
Gap October key revenue metric up 4 percent but misses St. view; 3Q outlook tops expectations
SAN FRANCISCO (AP) -- Gap's key revenue figure rose 4 percent in October, when analysts expected more. But the retailer's third-quarter outlook topped Wall Street's view.
Analysts polled by Thomson Reuters expected a 5 percent increase in the revenue at Gap, Banana Republic and Old Navy stores open at least a year. This figure is a key indicator of a retailer's health because it excludes results from stores recently opened or closed, which can skew business trends.
The chain's strongest showing in October was at its Gap stores, where revenue at stores open at least a year rose 6 percent. The metric dropped 2 percent for Gap's international stores.
Gap Inc. said that total revenue for the four weeks ended Oct. 27 climbed 6 percent to $1.22 billion.
For the third quarter, which runs from August through October, revenue at stores open at least a year rose 6 percent. The biggest improvement was at Old Navy, which posted a 9 percent gain in the metric. Overseas revenue at stores open at least a year fell 3 percent, the weakest performance.
Total revenue for the quarter increased 8 percent to $3.86 billion. Analysts surveyed by FactSet predicted revenue of $3.83 billion. The San Francisco company also anticipates quarterly earnings of 61 cents to 63 cents per share. Analysts expect 56 cents per share. Gap will report its full third-quarter financial results on Nov. 15.
Year-to-date revenue at stores open at least a year rose 5 percent. Total revenue climbed 6 percent to $10.93 billion.
Gap has about 3,000 company-run stores and approximately 250 franchise stores.
