Gap Inc. Logs 2% Net Sales Rise, 7.3% Operating Margin and $1B Buyback
Gap Inc. reported fiscal 2025 net sales of $15.4 billion, a 2% increase, with 3% comparable-store growth and $1.1 billion in operating income at a 7.3% margin. The company generated $1.3 billion in operating cash flow, authorized a new $1 billion share repurchase and raised next-quarter dividend to $0.175.
1. Fourth Quarter Fiscal 2025 Results
Gap Inc. posted net sales of $4.2 billion in Q4, up 2%, with online sales rising 5% to represent 42% of revenue and comparable sales up 3%. Gross margin declined 80 basis points to 38.1%, reflecting a 200-basis-point tariff impact, yielding $229 million in operating income (5.4% margin) and EPS of $0.45.
2. Full Year Fiscal 2025 Performance
Full year net sales reached $15.4 billion, a 2% increase, with comparable sales up 3% and online revenue rising 4% to 39% of total. Year-end gross margin was 40.8%, down 50 basis points on higher tariffs, producing $1.1 billion in operating income (7.3% margin), $2.13 EPS and $1.3 billion in operating cash flow.
3. Balance Sheet and Capital Returns
The company closed fiscal 2025 with $3.0 billion in cash and short-term investments, up $414 million, and ending inventory of $2.2 billion. It invested $470 million in capex, returned $402 million in dividends and buybacks—including repurchasing 7 million shares for $155 million—approved a new $1 billion repurchase authorization and raised the next-quarter dividend to $0.175 per share.