Core Insights - Gap Inc. reported a 2% increase in net sales year-over-year, marking the 9th consecutive quarter of market share gains [1][2] - The operating margin improved by 140 basis points to 7.5%, with a gross margin of 41.8% reflecting a 60 basis point increase [1][6] - Cash, cash equivalents, and short-term investments rose by 28% to $2.2 billion compared to the previous year [1][6] Financial Results - For the first quarter of fiscal 2025, net sales reached $3.5 billion, with comparable sales also up 2% [6] - Online sales increased by 6%, accounting for 39% of total net sales [6] - Operating income was reported at $260 million, with net income of $193 million and diluted earnings per share of $0.51 [6][28] Brand Performance - Old Navy's net sales were $2.0 billion, up 3%, with comparable sales also increasing by 3% [8] - Gap's net sales increased by 5% to $724 million, achieving positive comparable sales for the 6th consecutive quarter [9] - Banana Republic's net sales decreased by 3% to $428 million, while Athleta's net sales fell by 6% to $308 million [10][11] Balance Sheet and Cash Flow - The company ended the quarter with cash and cash equivalents of $2.0 billion, reflecting a 28% increase from the prior year [6][29] - Free cash flow was negative $223 million, primarily due to capital expenditures and seasonal factors [6][31] - Capital expenditures for the quarter totaled $83 million [6] Fiscal 2025 Outlook - The company anticipates net sales growth of 1% to 2% for the full fiscal year, with operating income expected to grow by 8% to 10% [12][13] - The effective tax rate is projected to be approximately 26% [13] - The company plans to close approximately 35 stores during the fiscal year [13] Store Count and Locations - As of May 3, 2025, Gap Inc. operated approximately 3,500 store locations across over 35 countries, with 2,496 being company-operated [6][35] - The total number of company-operated stores decreased by 10 during the quarter [35]