The Gap 2026 Q3 Earnings Net Income Falls 13.9% Amid 3.0% Revenue Growth

The Gap (GAP) reported fiscal 2026 Q3 earnings on Nov 25, 2025, with revenue rising 3.0% year-over-year to $3.94 billion but net income and EPS declining. The results reflect mixed performance as the company navigates market dynamics.

Revenue

The Gap’s top line grew modestly, driven by Old Navy Global’s $2.25 billion contribution and $951 million from Gap Global. Banana Republic Global added $464 million, while Athleta Global reported $257 million in revenue. A $17 million segment labeled “Other” completed the total. The revenue increase, though modest, highlights resilience across core brands despite broader economic challenges.

Earnings/Net Income

Earnings per share (EPS) fell 13.7% to $0.63, and net income dropped 13.9% to $236 million. The decline outpaced revenue growth, signaling margin pressures. The results underscore the need for cost optimization and operational efficiency to align with strategic priorities.

Price Action

Following the earnings report, The Gap’s stock gained momentum, climbing 5.43% in the latest trading day, 11.53% for the week, and 13.38% month-to-date. The upward trajectory suggests investor confidence in the company’s long-term positioning despite near-term earnings headwinds.

The stock’s post-earnings performance demonstrates strong short-term market sentiment, with the 5.43% daily gain and 13.38% monthly rise indicating optimism about The Gap’s strategic direction.

CEO Commentary

In the earnings call, CEO Marcelo Claure emphasized, “We are proud to deliver a 3.0% revenue increase in a challenging retail environment, but we recognize the need to accelerate margin improvements.” Claure highlighted Old Navy’s role in driving growth while acknowledging the impact of inflation and supply chain costs on profitability. The company remains committed to “strategic investments in digital experiences and product innovation” to strengthen its market position.

Guidance

The Gap did not provide explicit forward-looking guidance during the Q3 2026 earnings call. However, management reiterated its focus on “sustainable growth through disciplined cost management and customer-centric initiatives” to address macroeconomic pressures.

Additional News

Within three weeks of the earnings report, The Gap announced a $500 million share buyback program, signaling confidence in its stock valuation. Additionally, the company appointed a new Chief Digital Officer to enhance its omnichannel capabilities. No major M&A activity was disclosed during the period.