Jun 15, 2015
Gap to close 175 stores, cut jobs at headquarters
Jun 15, 2015
Apparel retailer Gap Inc said it would close a quarter of its Gap specialty stores in North America over the next few years, including 140 this year, and cut about 250 jobs at its headquarters.
The San Francisco-based company has been struggling with a persistent slump in sales at its namesake brand, where a series of fashion misses have resulted in shoppers turning to fast fashion rivals such as H&M, Inditex's Zara, and Forever 21.
The women's clothing business at the Gap brand has been a challenge for several seasons due to quality and fit issues and for being out of trend, Gap Chief Executive Art Peck said last month.
Gap said it expected to close 175 store over the next few years, resulting in annual sales losses of about $300 million.
These changes will not impact Gap Outlet and Gap Factory Stores.
The company reported sales of $16.44 billion for the year ended Jan. 31.
The company also expects to incur one-time costs of $140 million to $160 million, primarily in the current quarter.
Gap also said it would close some stores in Europe, but did not specify how many.
The company did not say how many employees would be laid off as a result of the store closures.
After the closures, the company will have 500 specialty Gap stores in North America, as well as 300 outlet stores, Gap said in a statement.
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