Gap's key sales metric up 6 pct as surging sales at Old Navy offset weak Gap sales

Ecommerce Associated Press

Gap Inc. said late Thursday that a key revenue metric rose 6 percent in November, as surging sales at its low-priced Old Navy chain offset sluggish sales at its namesake business.

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That figure surpassed Wall Street estimates for a 1.4 percent drop, according to Thomson Reuters.

The results offer encouraging signs for the San Francisco-based company, which hit a rocky patch this year after enjoying a turnaround since early 2012.

Last month, Gap Inc. cut its full-year profit outlook after reporting a sales shortfall in the fiscal third quarter and announced leadership changes at its Gap and Banana Republic brands. The moves were spearheaded by Art Peck as he takes on the role of CEO of Gap Inc. in February, succeeding Glenn Murphy who has been at the helm since 2007. Peck, a 10-year-veteran at Gap, had been its digital leader overseeing new innovations that cater to mobile-savvy shoppers

The retailer reported after the markets closed that total sales for November rose 6 percent to $1.72 billion from $1.63 billion in the year-ago period.

By brand, Gap's key metric called revenue at stores opened at least a year, was down 4 percent, while Banana Republic's sales rose 2 percent. Old Navy's revenue at stores opened at least a year surged 18 percent.

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Revenue from stores open at least a year is considered a key indicator of retail performance because it strips away the impact of recently opened or closed stores

The company has more than 3,200 company-operated stores and more than 400 franchise stores, along with its online shopping sites.

Shares of Gap Inc. rose 3.6 percent, or $1.44 to $42 in after-market trading, after slipping 4 cents to $40.56 in regular hours.