Retail group Gap Inc on Thursday said it would shutter 75 stores this year amid sagging sales, including 53 of its kids-focused Old Navy brand outlets in Japan.
Announcing a fall in first-quarter earnings, the San Francisco-based retailer also warned that it might not achieve previous earnings forecasts for this year given the headwinds buffeting the apparel industry.
“Old Navy will strategically shift its focus to markets most favorable to the brand’s growth,” the company said, explaining the Japan closings as Old Navy, its lowest-priced brand, concentrates on the US, Mexican and Chinese markets.
Photo: Bloomberg
However, it said that Japan “remains an important market,” with the continued presence of more than 200 Gap and Banana Republic stores.
The closings, aimed at cutting overall costs, would also include Banana Republic outlets, most of them in international markets, though the locations were not detailed.
Like many of its competitors, the company has been hit by shifting tastes and slower consumer spending worldwide, as well as competition from online fashion retailers.
“As the pace of change across the apparel industry increases, now is the time to accelerate our transformation by scaling our product and operating capabilities across our global portfolio,” Gap chief executive Art Peck said. “By taking every opportunity to exploit our strategic advantages, our brands will be able to more fully harness the power of the enterprise to better serve their customers across channels and geographies.”
Gap’s global net sales at US$3.44 billion were down 6 percent in the first quarter, ended April 30, from a year earlier. Sales were off in every region except Asia, where they registered a slight gain. Sales in the US, 77 percent of the total, were also down 6 percent.
Net income came in at US$127 million, or US$0.32 per share, down 47 percent from a year earlier, in line with what the company forecast in a revision early this month.
That helped boost its share price 2.7 percent in after-hours trade to US$17.28.
However, shares remained well below the high this year of just over US$30 a share in March.
UNPRECEDENTED PACE: Micron Technology has announced plans to expand manufacturing capabilities with the acquisition of a new chip plant in Miaoli Micron Technology Inc unveiled a newly acquired chip plant in Miaoli County yesterday, as the company expands capacity to meet growing demand for advanced DRAM chips, including high-bandwidth memory chips amid the artificial intelligence boom. The plant in Miaoli County’s Tongluo Township (銅鑼), which Micron acquired from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion, is expected to make a sizeable capacity contribution to the company from fiscal 2028, the company said in a statement. It would be an extended production site of Micron’s large-scale manufacturing hub in Taichung, the company said. As the global semiconductor industry is racing to reach US$1 trillion
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan’s food delivery market could undergo a major shift if Singapore-based Grab Holdings Ltd completes its planned acquisition of Delivery Hero SE’s Foodpanda business in Taiwan, industry experts said. Grab on Monday last week announced it would acquire Foodpanda’s Taiwan operations for US$600 million. The deal is expected to be finalized in the second half of this year, with Grab aiming to complete user migration to its platform by the first half of next year. A duopoly between Uber Eats and Foodpanda dominates Taiwan’s delivery market, a structure that has remained intact since the Fair Trade Commission (FTC) blocked Uber Technologies Inc’s
Memory chip stocks extended their losses yesterday after Alphabet Inc’s Google publicized research that could allow more efficient use of the storage needed for artificial intelligence (AI) development. SK Hynix Inc and Samsung Electronics Co, South Korean leaders in the market, fell more than 6 percent and about 5 percent respectively in Seoul. In the US, Micron Technology Inc, Western Digital Corp and Sandisk Corp slid more than 2 percent in pre-market trading, after they all closed lower on Wednesday. Memory companies have been on a tear in recent months as the rapid development of AI infrastructure triggered a spike in chip
RSS