Gap Beats Q1 EPS Estimates, But Tanks 14% — Outlook Steals The Story

Gap Inc. reported Q1 EPS of $0.90, beating the Street estimate of $0.42, but revenue of $3.5 billion slightly missed the $3.52 billion consensus. The stock fell 14% after the company lowered its fiscal 2026 revenue outlook from $15.71-$15.86 billion to $15.52-$15.67 billion, below the $15.74 billion analyst estimate. Despite nine consecutive quarters of positive comparable sales and 3% store sales growth, merchandise margins declined 100 basis points due to tariff impacts.