Gap Shares Down 9% On Lower March Sales, First-quarter Concerns

Gap Inc. on Thursday reported lower March sales and warned of possible lower gross margin rates for the first quarter, sending shares of the company down 9% in late trading. Gap reported March net sales reached $1.43 billion, down from $1.53 billion in March 2015. March comparable sales were down 6%, versus an increase of 2% last year. Comparable sales for its Banana Republic label were down 14% in March, versus a decline of 3% last year, and comparable sales at its Old Navy brand, which last year rose 14%, were down 6%. Gap said it has entered April with more inventory than planned, which the company said "will pressure its gross margin rate" in the fiscal first quarter. The stock had ended the regular Thursday session down 4%.