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Gap Plunges as Operational Missteps Are Worse Than Expected

  • Apparel retailer slashes its full-year earnings guidance
  • Company says challenges at Old Navy have hurt performance
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Gap Paints Weak Profit Picture Ahead
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Gap Inc. sank after lowering its full-year forecast and posting first-quarter profit that missed Wall Street expectations due to operational missteps and higher costs.

The apparel retailer, which owns the Old Navy, Banana Republic and Athleta brands, posted a loss of 44 cents a share in the quarter ended April 30 -- below analysts’ average estimate. Full-year earnings, excluding some items, are now seen at 30 cents to 60 cents a share, which is well below the $1.85 to $2.05 range previously provided.