Gap Inc. (NYSE: GPS), a global specialty apparel company, after-market close on Thursday reported its first-quarter financial results. The company’s first-quarter profit was flat. However, the San Francisco, California-based company raised its guidance for the year, sending shares higher in after-hours trading.
Gap’s first-quarter results suggest that the company is starting to get back on track after struggling for years to reclaim its status as a fashion leader. Glenn Murphy, CEO of Gap, said that during the quarter, GPS improved sales, grew earnings per share and continued investing in the business to drive performance. However, Murphy remains cautious. He said that while it is nice to celebrate the small win in the first quarter, it is a long year.
For the first quarter ended April 28, Gap reported net income of $233 million, or $0.47 per share. Analysts were expecting the company to report earnings of $0.46 per share.
Revenue for the quarter rose 6% to $3.49 billion, beating analysts’ estimate of $3.46 billion. Same-store sales for the quarter rose 4%. At Gap and Banana Republic stores in North America, same-store sales climbed 5%. Same-store sales at Old Navy stores in North America climbed 4% in the quarter.
GPS’ online revenue climbed 18% to $410 million in the first quarter.
For the full year, GAP raised its guidance. The company now expects full year earnings to come in between $1.78 per share and $1.83 per share, compared with previous guidance range of $1.75-$1.80 per share. Analysts expect Gap to report full year earnings of $1.97 per share.
Gap shares rose sharply in after-hours trading on Thursday. At last check, the stock was up 4.71% to $27.55. In regular trading on Thursday, Gap shares had finished 2.92% lower at $26.31 on above average volume of 9.80 million.
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