Gap Inc. Shares Surge 18% on Strong Q4 Earnings, Dividend Increased

Gap Inc. reported better-than-expected fourth-quarter earnings, with shares skyrocketing by over 18% following the announcement. The retailer's adjusted earnings per share reached $0.54, surpassing analyst estimates of $0.36, while revenue hit $4.15 billion, slightly above the expected $4.07 billion. President and CEO Richard Dickson attributed the positive results to operational improvements and successful brand strategies, despite facing challenges with certain brands like Athleta. Guidance for fiscal 2025 forecasts net sales growth of 1% to 2%, and the company announced a 10% increase in its quarterly dividend. Analysts expressed cautious optimism about Gap's trajectory, noting a need for sustained margin improvements amid ongoing macroeconomic pressures. The performance reflects a broader retail sentiment shift, as Gap's turnaround plan seems to be gaining traction faster than anticipated.