• by Sarah Mahoney  @mahoney_sarah, March 10, 2025

 With sales gains at three out of four divisions, the Gap’s comeback campaign is gaining traction.

Total sales for the largest specialty apparel company in the U.S. slipped 3% to $4.1 billion in the fourth quarter of the fiscal year, mostly due to a calendar shift. On a comparable basis, sales rose 3%, as the retailer notched gains at Gap (up 7%), Old Navy (3%) and Banana Republic (4%.) Sales fell 2% at Athleta.

The gains come as Gap looks to regain some of the style swagger that has eluded the company for years. That includes a joyful spring campaign starring indie legend Parker Posey and a Banana Republic capsule collection featuring looks from the latest season of “The White Lotus.”

“We ended the year delivering another successful quarter, exceeding financial expectations and gaining market share for the 8^th consecutive quarter,” said Richard Dickson, president and CEO, in the announcement. “For 2024, Gap Inc. delivered positive comps in all four quarters.”

He credits the gains with momentum in the San Francisco-based company’s execution and “the reinvigoration of our brands as they climb in the cultural conversation.”

Net income advanced to $206 million from $185 million in the year-ago period.

That reinvigoration is evident in new marketing. In “Feels like Gap,” the company hopes to recapture the idea of self-expression through timeless wardrobe staples, with Posey dancing like no one is watching.

The big idea is clothes that move. “Feeling comfortable is the ultimate confidence,” said Mark Breitbard, president and CEO of the Gap brand, in the campaign announcement, with the new collection “designed to empower you to move freely and authentically. True style starts with feeling good in what you wear -- Parker is unapologetically herself -- a true Gap original.”

Ads are running on digital media, out-of-home, video, social, and brand channels and include plenty of creator-led content.

Banana Republic’s “The White Lotus” collection builds on the HBO hit’s spirit of escapism. The capsule includes 24 ultra-packable pieces using rich turquoise, navy, red, and yellow hues in European flax linen, lightweight cotton poplin, and 100% silk. Ads for the new line star cast member Patrick Schwarzenegger alongside model and podcast host Shanina Shaik.

Industry observers are impressed with Gap’s transformation. “After years of struggles, CEO Richard Dickson has made progress in restoring some relevance to all four brands,” writes David Swartz, an analyst who follows Gap for Morningstar. “Signaling improved merchandising and marketing, Gap reports that each brand achieved share gains in 2024.”

Still, Swartz notes a tough road ahead for Gap as the retailer chases after past glory days. “Gap consistently achieved adjusted operating margins above 8% before the pandemic,” he notes, “but we do not think it can return to historical levels as competition in the retail apparel market has intensified.”