Gap lower after-hours after reporting earnings

Gap posted revenue of $4.42 billion and an adjusted EPS of 28 cents, compared to an estimated revenue of $4.67B and an adjusted EPS of 17 cents. Yahoo Finance's EMily McCormick joined Yahoo Finance Live to break down the key metrics.

Video Transcript

SEANA SMITH: We want to get to some breaking news. We have Gap is out with its earnings report. Emily McCormick has that for us. Emily.

EMILY MCCORMICK: And Seana, we're taking a look at shares of Gap falling in late trading after the company missed on fourth quarter comparable same store sales. So it's seeing some weakness, especially in that Old Navy brand, which is the biggest contributor to revenue for Gap. Now going through these numbers, we saw overall same store sales flat, so 0%, versus a rise of 2% expected for the fourth quarter ending in January. And taking a look by brand, we saw Old Navy comparable same store sales up 7%. But that did miss consensus expectations for a rise of 11.8%.

Now, taking a look at the other major brands at Gap, the flagship Gap brand actually saw comparable sales down 6%. That was worse than the drop of 4 and 1/2% expected. And Banana Republic saw comparable sales down 22%. Now taking a look at that net sales figure, that came in at $4.42 billion. And that was a miss compared to expectations and also down 5% year over year. And the company highlighted that brick and mortar store sales declined 28% in the quarter, which reflects impacts from COVID and strategic closures of their brick and mortar locations.

Now, finally, want to highlight some guidance that the company gave for the current year. The company sees full year earnings per share coming in between $1.20 and $1.35 per share. And then taking a look at those fourth quarter earnings, we did see those come in at $0.61 per share, which did include some one-time charges, so it may not compare to estimates. But again, we are seeing some pressure for Gap shares. Those are down, paring some losses, but still down just about 1% in late trading. Seana.