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MIllennials boost for Gap as they flock to Old Navy

Net sales for the first quarter were flat at US$3.4bn though they rose 2% on a like-for-like basis
picture of Gap store
Old Navy increased like-for-like sales by 8%

Gap Inc (NYSE:GPS ) has emerged as one of the few retailers to beat forecasts in the latest earnings season.

The group hailed the performance of its Old Navy low cost brand and also Athleta, its leisure/athletics wear label as earnings per share jumped by 12.5% to 36c.

Old Navy increased like-for-like sales by 8% as millennials, those who became adults in the current century, lapped up the brand.

Banana Republic and Gap outlets had a harder time with like-for-like sales dropping by 4% at both chains.

Net sales for the first quarter were flat at US$3.4bn though they rose 2% on a like-for-like basis. Profits rose to US$238mln (US$204mln)

For the full year, Gap kept full year diluted earnings per share guidance to in the range of $1.95 to $2.05 though the first half is looking a bit better.

Art Peck, chief executive, said: “We've made substantial improvements in product quality and fit, and our increasing responsive capabilities are enabling us to better react to trends and demand."

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