Gap beats Q3 estimates, raises FY2025 outlook as Old Navy and Gap brand comps surge

Gap just delivered a clean Q3 fiscal 2025 beat and raised outlook, showing its turnaround is gaining traction. Net sales rose about 3% to roughly $3.9B, comparable sales were up 5% (best in 4+ years), and gross margin came in strong around 42%. Old Navy, Gap brand, and Banana Republic all posted positive comps, while Athleta kept sliding. Management also lifted full-year sales growth expectations to about 1.7%–2.0% and guided to operating margin near 7% even after factoring tariff pressure.

Winners -

US apparel retailers with improving brand heat and pricing power

Reason: Gap’s broad-based comp strength signals consumers are still buying apparel when product and marketing hit, which can lift sentiment and multiples acr ...