Gap CEO Richard Dickson Talks Turn Around, Earnings
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Bloomberg's Lisa Abramowitz joins us now and she is sitting down with the CEO of the Gap. Lisa.
Thank you so much, Matt. Yeah, we do have Richard Dixon, who is the CEO, the not so new chief executive officer of Gap Incorporated since 2023. Great to see you, Richard. Thank you for being with us. I want to start. You definitely were one of the winners this retail season with beats across the board, increasing your full year forecast. I'm wondering how much the key to success this season in retail is catering to wealthier investors who can spend more at a higher price point.
Well, first off, thank you. It's clear our strategy is working and it is showing up in the momentum. And we're seeing that in the results. We've had consistent strength from our consumer behavior that we're winning, actually, with all income cohorts. When you look at the overall sales, comp up 5%. That's the seventh consecutive quarter of positive comps for us. Our leading brand, Old Navy, the largest brand, delivered an outstanding quarter. We were up 6%. Gap up 7%. Banana Republic up 4%. Gross margin exceeding expectations. So from an overall perspective, what we see and are proving is consistency in the context of our strategy and our playbook. As we look at consumers, We do see the consistency and strength with our customer behavior.
And we've been winning with all income cohorts, as you can see from the differentiation in our portfolio. We saw equal growth across low, middle, and high. And while we're seeing external data points to macro pressure, particularly in the lower end, income consumer, our customers are finding our price, our value, our style, breaking through the competition. And ultimately, we're very excited to be winning in the marketplace, giving us a lot of confidence as we head into the holiday season.
Yeah, talking about the holiday season, how robust do you expect it to be? How is it coming along? And how much are consumers resilient even in the face of price increases?
Look, holidays come every year. We're off to a great start. We have great activations that are planned this holiday. In particular, I'm very excited about certain categories, denim, sleepwear, fleece. These look really strong. Our value proposition, our marketing executions, hopefully you've seen some of the creative. When you go online to our sites, we're well positioned to serve our customers wherever and however they choose to shop. We just, for example, Old Navy did a partnership with DoorDash, which provides convenience for tens of millions of users. Our stores are ready, our teams are fired up, and we're looking to a strong finish to the year.
So, Richard, I expect you actually coming on and dancing to Milkshake in the background because I hear you talking about some of the cultural relevance, and I wonder how much the battle for cultural relevance has been front and center for you about that viral ad. How much are you looking to new partnerships, new types of advertising as a way to really drive Gap Strategy?
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