• Chain Store Age, Monday, November 21, 2011 10:03 AM

Gap Inc. reported Thursday that profit for the third quarter dropped 36% to $193 million, compared with $303 million a year earlier, as the retailer continued a deep discounting trend and encountered rising production costs. Still, results beat analysts’ expectations.

In October, Gap announced it would close 189 U.S. locations by the end of 2013, while tripling its China presence. Overall, the company intends to cut its square footage in the U.S. by 10% by 2013, compared with 2007, and to double the share of its revenue that comes from outside of the U.S. to 30%.

"Across our brands, we're intensely focused on improving our current sales trend, including making necessary product and marketing adjustments, with a view toward building momentum as we head into 2012," Glenn Murphy, Gap Inc.'s CEO and chairman, said in a statement. "We're ready to compete aggressively this holiday."

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