Latest news with #Dickson
Yahoo
a day ago
- Business
- Yahoo
Gap CEO: The trade war has not stalled our turnaround
Gap (GAP) CEO Richard Dickson says his turnaround of the retailer remains intact despite trade war headwinds. "No," Dickson told Yahoo Finance (video above) on whether the trade war has stalled his progress. Dickson added, "Like any business, we're constantly navigating complexity. And there's a lot of complexities in running a business. And in this case tariffs is a focus. But it's our responsibility to do so without ever compromising the long-term integrity of our strategy." Gap shares were pounded by about 20% Friday in the wake of its first quarter results. While the company beat analyst sales and profit forecasts, it warned of a large hit to operating profits this year at the hands of tariffs. Some analysts estimated the impact could be about $0.25 a share for the year. To navigate the volatile trade backdrop, Gap is lowering its sourcing from China from less than 10% in 2024 to less than 3% exiting the year. By the end of 2026, no single country should account for more than 25%. The company is also doubling its vendor sourcing for American-grown cotton in 2026. "Overall, Gap is executing very well, delivering top-line consistency at Old Navy and Gap (and management said 2Q is off to a good start), gross margin upside and showing cost discipline. While we expect Gap to be in the penalty box near-term on the Gap brand falling short of market expectations and tariff guidance, we believe risk/reward is especially attractive [on the stock's decline]," Citi retail analyst Paul Lejuez said in a note. Net sales: +2% year over year to $3.5 billion, vs. $3.42 billion estimate Comparable sales: Old Navy: +3% compared to +3% last year, vs. +1.7% estimate Banana Republic: 0% compared to +1% last year, vs. +1.6% estimate Gap: +5% compared to +3% last year, vs. +3.25% estimate Athleta: -8% compared to +5% last year, vs. -1.94% estimate Gross margin: 41.8% compared to 41.2% last year, vs. 41.6% estimate Diluted earnings per share: $0.51 vs. $0.45 estimate Trade war effects: Inventory levels rose 7% from the prior year. Trend watch: The company's same-store sales have gained for five straight quarters. Flush with cash: The company's total cash position surged 28% year over year to $2.2 billion. Warning: If tariffs stay in place at current levels, it could cost Gap $250 million to $300 million this year. Guidance does not include this impact, Gap says. Gap adds it could mitigate about half of the tariff impact — bringing a $100 million to $150 million potential hit to operating income. Guidance: 2025 Net sales: +1% to +2% (reiteration) Operating income: +8% to +10% (reiteration) Q2 2025 Net sales: Flat (consensus: up slightly) Gross margin: "Similar" to the first quarter rate of 41.8% (consensus: 42.3%) Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email Click here for all of the latest retail stock news and events to better inform your investing strategy
Yahoo
a day ago
- Business
- Yahoo
Gap CEO: The trade war has not stalled our turnaround
Gap (GAP) CEO Richard Dickson says his turnaround of the retailer remains intact despite trade war headwinds. "No," Dickson told Yahoo Finance (video above) on whether the trade war has stalled his progress. Dickson added, "Like any business, we're constantly navigating complexity. And there's a lot of complexities in running a business. And in this case tariffs is a focus. But it's our responsibility to do so without ever compromising the long-term integrity of our strategy." Gap shares were pounded by about 20% Friday in the wake of its first quarter results. While the company beat analyst sales and profit forecasts, it warned of a large hit to operating profits this year at the hands of tariffs. Some analysts estimated the impact could be about $0.25 a share for the year. To navigate the volatile trade backdrop, Gap is lowering its sourcing from China from less than 10% in 2024 to less than 3% exiting the year. By the end of 2026, no single country should account for more than 25%. The company is also doubling its vendor sourcing for American-grown cotton in 2026. "Overall, Gap is executing very well, delivering top-line consistency at Old Navy and Gap (and management said 2Q is off to a good start), gross margin upside and showing cost discipline. While we expect Gap to be in the penalty box near-term on the Gap brand falling short of market expectations and tariff guidance, we believe risk/reward is especially attractive [on the stock's decline]," Citi retail analyst Paul Lejuez said in a note. Net sales: +2% year over year to $3.5 billion, vs. $3.42 billion estimate Comparable sales: Old Navy: +3% compared to +3% last year, vs. +1.7% estimate Banana Republic: 0% compared to +1% last year, vs. +1.6% estimate Gap: +5% compared to +3% last year, vs. +3.25% estimate Athleta: -8% compared to +5% last year, vs. -1.94% estimate Gross margin: 41.8% compared to 41.2% last year, vs. 41.6% estimate Diluted earnings per share: $0.51 vs. $0.45 estimate Trade war effects: Inventory levels rose 7% from the prior year. Trend watch: The company's same-store sales have gained for five straight quarters. Flush with cash: The company's total cash position surged 28% year over year to $2.2 billion. Warning: If tariffs stay in place at current levels, it could cost Gap $250 million to $300 million this year. Guidance does not include this impact, Gap says. Gap adds it could mitigate about half of the tariff impact — bringing a $100 million to $150 million potential hit to operating income. Guidance: 2025 Net sales: +1% to +2% (reiteration) Operating income: +8% to +10% (reiteration) Q2 2025 Net sales: Flat (consensus: up slightly) Gross margin: "Similar" to the first quarter rate of 41.8% (consensus: 42.3%) Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email Click here for all of the latest retail stock news and events to better inform your investing strategy Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Repositioning Banana Republic to Regain Relevance
Banana Republic has been hanging in for decades, seeking to reconnect with consumers through a succession of repositionings, from the original safari style to serious careerwear to business casual, and as of late, some modern utility. The path has been bumpy, marked by store fleet downsizings, management changes, logo changes, category introductions of mixed success, and an inability to attract the next generation of shoppers. Two years ago, Banana Republic introduced a home assortment. A year later, the furniture was discontinued while soft home items, like towels, throws and pillows, continue to be sold. Two categories — BR Baby and BR Athletics — were introduced three years ago and didn't do much to move the needle. More from WWD Gabrielle Union Anchors Bold Banana Republic Dress With Textured Manolo Blahnik Raffia Mules at Proudly x JCPenney Launch Laura Harrier and Zac Posen Celebrate Denim and Dandyism in Bold Gap Studio Suit That Challenges Binaries Around Masculinity and Femininity 'The White Lotus' Actor Nicholas Duvernay Stars in Banana Republic's Spring 2025 Campaign Featuring Timeless Pieces, 'Buttery' Suede and More But the most recent changes — and they're ongoing — seem more consequential considering Gap Inc. chief executive officer Richard Dickson has been on the case since the abrupt departure of Sandra Stangl in May 2024, Banana's last president and CEO. 'We've gone back to the roots of the brand and what made it great to begin with — the Safari look but we're reestablishing the brand to convey a modern explorer and travel story. It's really starting to resonate,' Dickson told WWD. 'There is still work to do but we are continuing to strengthen the foundation with each passing quarter.' The White Lotus x Banana Republic limited-edition capsule collection, inspired by the HBO series 'The White Lotus,' helped spotlight the brand and convey its new approach. Dickson also said the search for a new Banana Republic president and CEO continues and that he has been meeting with 'some extraordinary talent.' There seems to be no rush given it's been over a year since there was someone in that role. Dickson, however, did acknowledge that he's been devoting a greater portion of his time to being more hands-on at Banana Republic. The game plan revolves around evoking what put Banana Republic on the map in the first place — a sense of adventure and exploration but through revised merchandising and marketing. There are early signs that recent efforts are bearing fruit, with Banana's comp sales flat last quarter, and total sales down 3 percent. 'The flat comp in the quarter is actually great progress,' Dickson said. 'We've leaned into classics, fits are resonating, men's is performing really well, and there is an improved performance in women's.' For all of 2024, Banana Republic reported comp sales were up a point, and total sales were flat. Recently, WWD met with Meena Anvary, Banana's head of marketing, at the Banana Republic flagship in SoHo, where she explained how the collection is evolving, how the brand positioning is being clarified, and how the 'storytelling' has become richer. She said Banana is going 'back to its roots but in a modern way,' utilizing higher-quality fabrics from Italy, exhibiting more texture such as jacquards and softer color palettes, and overall designing so the fashions convey 'a modern utility where practicality meets style.' 'We're seeing a natural evolution in both women's and men's offerings that reflects a modern sense of ease and timelessness,' Anvary said. 'For women, we've expanded our dress assortment to include airy silhouettes, coastal color palettes and a versatility that's great for any occasion this summer. 'For menswear, it's about modern utility with garments that are both purposeful and elevated. The pieces are crafted from premium fabric mills in Italy and tailored for comfort, style and versatility.' Modern utility, she explained, is about 'marrying function with form in a way that feels intentional and elevated. This is seen through subtle design cues, such as clean lines, convertible pieces, unexpected pockets, and epaulettes, which are a nod to our heritage in exploration, but through a contemporary lens. Epaulettes, specifically, are an homage to our past but reinterpreted in refined, luxurious fabrics. It's that balance of polish and practicality that defines our brand.' She was referring to Banana Republic's safari look which was most prominent in the 1980s. What also stood out at the flagship was an ample presentation of third-party brands, about 10 in all, including hats from Australia's Lack of Color; Castañer footwear, which is known for its craftsmanship and espadrilles; Hunza G swimwear, and cool eyewear from Le Specs, thereby taking a lifestyle merchandising approach. Also on display were candles, books and body washes. 'We highlight tastemakers in our campaigns and in-store activations, whether it be an artist, a chef or someone in entertainment to bring the world of Banana Republic to life in a multidimensional way,' Anvary said. For example, she said Banana Republic has been partnering with Jonah Reifer on events at the SoHo store and has featured Tyler Florence in Banana Republic's 'Art of Living' series on social. 'Our summer collection inspires a sense of ease and timelessness and takes people on our travels. We were inspired by Sicily and Majorca and went on a journey through charming towns, romantic coastlines,' Anvary said. The summer campaign, she added, has 'a local perspective highlighting a sense of curiosity and discovery our customer loves. 'We also tie into the quality and craft inherent to Italian culture and our linen, which is milled in Italy. In Majorca, we were inspired by the slower pace of life and connecting to nature, the rocky coastlines and fishing boats. Majorca inspired our original shell print for the season, while shirtdresses, leather sandals, and plenty of linen round out the uniform for summer travel.' She said Banana Republic is 'creating stories beyond the clothes themselves, and it lives across every detail, from the way a print is illustrated to the settings we choose for our campaigns. We tell an immersive story, infusing our campaign with the character and charm of our travels to create connection and a true sense of place. This summer's campaign is a perfect example. We shot in Majorca and Sicily, locations rich in character and culture. We engaged local Sicilians we met along the way and included them in our campaign, like Rosaria who has lived in an apartment above the town square in Cefalù for more than 40 years. She even shared her family's limoncello recipe with us.' Best of WWD Macy's Is Closing 66 Stores in 2025 — Here's the List, Live Updates Inside the Demise of Lord & Taylor COVID-19 Spikes Elevate Retail Concerns Error in retrieving data Sign in to access your portfolio Error in retrieving data
Mint
2 days ago
- Business
- Mint
Gap Sinks After Reporting Weakness at Banana Republic, Athleta
(Bloomberg) -- Gap Inc. slumped in late trading after stubborn weakness at Banana Republic and Athleta offset strength at its Old Navy and namesake brands. At Banana Republic, which has the highest price point among Gap's brands and is focused on leisurewear, revenue fell 3% in the fiscal first quarter ended May 3 from a year earlier. Progress has been slow at the chain, and Gap said it's focused on 'reestablishing' the brand and 'improving the fundamentals.' The company is taking a similar approach to the sportswear brand, Athleta, where net sales fell 6%. 'Work is being done to reset the brand and improve product and marketing, which will take time,' Gap said. The results contrasted with Old Navy and Gap, where comparable-store sales rose 3% and 5%, respectively. Revenue of $3.5 billion in the period also outperformed expectations. Gap shares fell 15% at 4:22 p.m. in extended New York trading. The stock has advanced 18% so far this year. Gap estimates an impact of $250 million to $300 million from tariffs if their level remains at 30% for most goods from China and 10% for other countries. The company, which kept its guidance stable from the previous quarter, says it has strategies to mitigate more than half of that cost. Since Richard Dickson took over as chief executive officer of the San Francisco-based retailer nearly two years ago, the Old Navy and Gap brands have rebounded on refreshed product lines, including Gap's collaborations with brands such as Dôen and Cult Gaia. The company is also updating layouts and displays at some stores to make them more enticing. 'Gap and Old Navy are the largest brands in the portfolio, and therefore are the two leading indicators of the execution of our playbook,' Dickson said in an interview. Sales of denim and activewear were standouts at the brands, he added. Dickson has focused on making the company cool again — which has included tapping celebrities like Lindsay Lohan and Troye Sivan for its advertising and bringing on celebrity designer Zac Posen. Together, Old Navy and Gap generated about 78% of the company's sales in the fiscal first quarter. The brands have made inroads across all income groups, Dickson said. Retailers have posted uneven results for the start of this year as abrupt changes in US trade policy under President Donald Trump erode consumer sentiment. Cautious shoppers have pulled back on some discretionary purchases, but the impact has varied among companies. American Eagle Outfitters Inc. pulled its full-year outlook, citing 'macro uncertainty,' as well as discounts across the industry and merchandise missteps. In contrast, Abercrombie & Fitch Co. boosted its sales guidance, suggesting the hit from tariffs will be manageable. (Recasts story to focus on weakness at Banana Republic, Athleta) More stories like this are available on
Daily Mail
3 days ago
- General
- Daily Mail
Albanese's post-election message to Dutton after coalition's defeat
Anthony Albanese has offered his commiserations to Peter Dutton, insisting that the former Opposition Leader will be 'successful' in life outside politics. The Prime Minister told Brisbane's Nova FM radio station that he had 'an okay relationship, a professional relationship, if you like' with the former Liberal leader. 'It's really tough for him and his family as well,' Albanese added. 'I'm not sure what he will do, but I'm sure he'll be successful in other arenas as well.' Dutton suffered the ultimate indignity on election night when he not only led a failed campaign but was ousted from his own seat of Dickson in Brisbane 's outer-northern suburbs - which he had held since 2001 - by Labor's Ali France. In a reflection of the respect the two men held for one another - even if they traded barbs on the campaign trail - Dutton gave a gracious concession speech in which he revealed he had rung Albanese to tell him how proud his late mother would have been of his victory. The Prime Minister said politics was an 'honourable profession' but acknowledged it came with huge downsides. 'You expose yourself publicly, particularly with social media,' he told the radio station. 'Don't read the comments out there, folks. It can be really brutal, and you've got to be resilient.'
