Gap — Aug 27, 2026 release

Fiscal 2026 Outlook The Company's outlook reflects a balanced approach, factoring in visibility into the consumer and broader macroeconomic and geopolitical environment in the near term which is largely unchanged, while recognizing potential uncertainties moving forward around energy prices and U.S. tariffs. The Company's updated full-year net sales outlook of up 1% to 1.5% now assumes Old Navy comparable sales of flat to down 1%, compared with the prior range of flat to up 1%, reflecting the brand's second-quarter performance. Comparable sales at the Gap brand are now expected to grow in the high-single to low double-digit range, compared with prior expectations of up high-single digits, while expectations for the balance of the portfolio remain unchanged. On a reported basis, the Company now expects full year diluted earnings per share to be approximately $3.77 to $3.87. The Company's outlook below is provided on an adjusted, non-GAAP basis. Full Year Fiscal 2026 Current FY 2026 Outlook Prior FY 2026 Outlook FY 2025 Results 1 Net sales Up 1% to 1.5% year-over-year Up 1% to 2% year-over-year $15.4 billion Adjusted gross margin Up slightly year-over-year Flat to up slightly year-over-year 40.8% Adjusted operating expense (% of net sales) About flat year-over-year About flat year-over-year 33.5% Adjusted operating margin About 7.4% to 7.6% About 7.3% to 7.5% 7.3% Adjusted interest, net Approximately $20 million Approximately $25 million $17 million Adjusted effective tax rate Approximately 25% to 26% Approximately 25% 27.9% Diluted weighted average share count Approximately 367 million Approximately 375 mil