Gap (GAP) Q3 2025 Earnings
How Did GAP Stock React to Q3 2025 Earnings?
S&P 500 over the same 30 days: +4.76%.
Did GAP Beat Earnings? Q3 2025 Results
Yes. Gap reported Q3 2025 earnings of $0.62 a share on Nov 20, 2025, beating the $0.59 consensus estimate by 5.6%. Revenue was $3.9B against a $3.9B estimate.
Gap Inc. posted a broadly stronger-than-expected third quarter, with the apparel retailer's seventh consecutive quarter of positive comparable sales underscoring the durability of its brand turnaround. Net sales rose 3.0% year-over-year to $3.94 billion, edging past the $3.90 billion consensus estimate, while GAAP diluted EPS of $0.62 beat the $0.59 analyst forecast by 5.59%, even as the figure stepped down from $0.72 in the year-ago period due to higher operating expenses and an elevated effective tax rate of 30%. The standout driver was comparable sales growth of 5%, led by Old Navy's 6% comp gain and the Gap brand's 7% increase, its eighth straight positive comp quarter, though Athleta remained a notable drag with net sales falling 11%. Tariffs weighed on gross margin, which contracted 30 basis points to 42.4%, with management estimating roughly 190 basis points of merchandise margin pressure from that source alone. On the strength of the quarter, Gap raised its full-year operating margin outlook to approximately 7.2% and tightened its net sales growth guidance to 1.7% to 2.0%, inclusive of an estimated 100 to 110 basis points of net tariff impact.
- Comparable sales up 5% for the 7th consecutive quarter
- Old Navy winning in denim, active, and kids/baby categories with culturally relevant partnerships
- Gap brand achieving 8th consecutive quarter of positive comp sales through reinvigoration playbook
- Growth in average unit retail driving underlying merchandise margin expansion
- Online sales increased 2% and represented 40% of total net sales
- Store sales increased 3% year-over-year
“We are proud to report that Gap Inc.'s third quarter results exceeded our net sales and margin expectations and delivered the seventh consecutive quarter of positive comparable sales.”
Gap CEO, on the earnings call
What Was Gap's Outlook in Q3 2025?
Gap Inc. raised its full year fiscal 2025 outlook. Net sales growth is now expected at 1.7% to 2.0% (narrowed to the high end of the prior 1.0% to 2.0% range). Operating margin is now expected at approximately 7.2%, up from the prior range of 6.7% to 7.0%, both inclusive of an estimated 100-110 basis points of net tariff impact. The effective tax rate is expected to be approximately 28% (up from approximately 27%). Net interest income is expected at approximately $20 million (up from approximately $15 million). Capital expenditures remain at approximately $500 to $550 million. Net store closures remain at approximately 35.
GAP YoY Financials
| Metric | Q3 2025 | Q3 2024 | Year over year |
|---|---|---|---|
| Revenue | $3.9B | $3.8B | +3.0% |
| Gross Profit | $1.7B | $1.6B | +2.1% |
| Operating Income | $334.0M | $355.0M | −5.9% |
| Net Income | $236.0M | $274.0M | −13.9% |
GAP Revenue by Segment
GAP Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.