Leading American specialty apparel Gap Inc has reported net sales of $3.7 billion for the second quarter of fiscal 2024 (Q2 FY24), marking a 5 per cent increase compared to the same period last year. This growth was bolstered by a 3 per cent rise in comparable sales year-over-year (YoY).

The company's store sales saw a 4 per cent increase compared to last year, ending the quarter with 3,568 store locations in approximately 40 countries, of which 2,541 are company-operated. Online sales also experienced significant growth, rising by 7 per cent YoY and accounting for 33 per cent of total net sales, the company said in a press release.

Gap Inc's gross margin improved notably, reaching 42.6 per cent, a 500-basis-point increase from the previous year. The merchandise margin also saw a rise of 410 basis points. The company's operating expenses stood at $1.3 billion, while operating income reached $293 million, resulting in an operating margin of 7.9 per cent. Gap Inc recorded a net income of $206 million, with diluted earnings per share of $0.54.

The standout performer for Gap Inc was Old Navy, which reported net sales of $2.1 billion for the second quarter, up 8 per cent compared to last year. Comparable sales also saw a significant rise of 5 per cent.

The Gap brand reported second-quarter net sales of $766 million, a 1 per cent increase from last year. Comparable sales were up 3 per cent, marking the third consecutive quarter of positive comparable sales for the brand.

Banana Republic’s net sales for the second quarter remained flat at $479 million, with comparable sales also unchanged from last year. Athleta reported a slight decline in its second-quarter performance, with net sales of $338 million, down 1 per cent from last year. Comparable sales dropped by 4 per cent.

“Gap delivered another successful quarter, exceeding financial expectations and gaining market share for the sixth consecutive quarter," said president and chief executive officer, Richard Dickson. "In comparison to where we were only one year ago, we are in a stronger position across key metrics that matter—including net sales, margins, and our cash position—and we are making consistent progress in the reinvigoration of our brands. These results are a reflection of the dedication and collaboration of our global team, reinforcing my confidence that we are well on our way to unlocking the full potential of this extraordinary portfolio of iconic American brands."

Fibre2Fashion News Desk (DP)