The Gap, Inc.
Q4 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: −3.24%.
Did GAP Beat Earnings? Q4 2026 Results
Gap Inc. closed out fiscal 2025 on a mixed but broadly encouraging note, posting Q4 earnings per share of $0.45 against a consensus estimate of $0.38 — an 18.42% beat — even as revenue of $4.24 billion landed essentially in line with expectations, up 2.1% year-over-year. The bottom-line strength reflected what CEO Richard Dickson described as a transformation playbook delivering results, with the quarter marking the company's eighth consecutive period of positive comparable sales and full-year gross margin reaching one of its highest levels in 25 years. Brand performance, however, was uneven: the Gap brand surged 8% in net sales and Old Navy held steady with 3% growth, while Athleta continued to weigh on results with an 11% sales decline and comps down 10%. Shares fell roughly 9.5% following the report, as investors zeroed in on Q1 2026 guidance calling for net sales growth of just 1% to 2% and gross margin pressure of 150 to 200 basis points, with tariffs accounting for an estimated 200 basis points of that headwind. For the full year, Gap expects adjusted diluted EPS of $2.20 to $2.35.
- Eighth consecutive quarter of positive comparable sales (3% comp growth)
- Online sales increased 5% in Q4, representing 42% of total net sales
- Old Navy's price-value equation resonating across income levels
- Gap brand expanding customer base across generations with 7% comp growth
- Banana Republic delivered third consecutive quarter of comp growth
- Average unit retail grew as a result of lower discounting
- ROD as a percent of sales leveraged 10 basis points in Q4
“I am pleased to report that Gap Inc. delivered a successful fourth quarter, marking another year of meaningful progress. The execution of our playbook is driving consistent results, as we achieved our second consecutive year of topline growth and eighth consecutive quarter of positive comparable sales. Financial and operational rigor combined with the strength of our platform drove one of our highest gross margins in the last 25 years and further strengthened our balance sheet.”
Gap CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2026 (based on tariff rates prior to February 20, 2026), Gap Inc. expects net sales growth of 2% to 3% year-over-year, gross margin flat to up slightly, adjusted operating expense about flat as a percentage of net sales, adjusted operating margin of approximately 7.3% to 7.5%, net interest income of approximately $10-$15 million, an effective tax rate of approximately 27%, adjusted diluted EPS of approximately $2.20 to $2.35, and capital expenditures of approximately $650 million. Including the net benefit of a $313 million legal settlement gain and $50 million charitable donation in Q1, reported diluted EPS is expected to be approximately $2.71 to $2.86. For Q1 fiscal 2026, the company expects net sales growth of 1% to 2%, gross margin down approximately 150-200 basis points including an estimated 200 basis points of net tariff impact, and adjusted operating expense at about 35% of net sales.
GAP YoY Financials
GAP Revenue by Segment
GAP Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.