Gap's Got Tariffs? More Like Gap's Got PROBLEMS! (And Maybe Lindsay Lohan Can Help?)

Uh Oh Stinky: Tariffs Edition

Okay okay chat settle down. I saw the news and like *gasps* Gap might be in a little bit of a pickle. Apparently these new tariffs could smack them with a $100 million to $150 million bill. That's a LOT of hoodies even at Old Navy prices. Shares dropped like I drop in Valorant when I try to clutch (don't @ me!). The company is saying that new import duties from China and other countries will cost them up to $300 million without any action. So it looks like we might need a 'pokiRaid' to help them through this one.

Mitigation? More Like...Mitigation Impossible!

Gap's trying to be all strategic saying they've already mitigated about half the costs. But even with that we're still talking serious $$$ potentially hitting their bottom line later this year. Their master plan? Diversifying the supply chain and sourcing more cotton from the U.S. Smart move Gap. CEO Richard Dickson even said they don't expect price increases for us the consumers. Bless their hearts. "We truly believe that strong brands can win in any market" Dickson says. Is Gap a strong brand? Only time will tell I guess.

Earnings Beat? Don't Get Too Excited Chat

Alright so here's where things get a little twisted. Gap actually *beat* expectations on earnings per share (51 cents vs. 45 cents expected) and revenue ($3.46 billion vs. $3.42 billion expected). Net income rose! Sales rose! Everyone gets a participation trophy! But the gross margin forecast is apparently weaker than expected. So like good news bad news who even knows anymore? My brain!

China? More Like...Vietnam!

In March Gap was all chill like "Oh China's only a small part of our production." But now they're scrambling to move even more production out of China. Apparently Vietnam and Indonesia are their new BFFs. But hold up there's talk of a 46% reciprocal tariff on Vietnam? If that happens it's GG my friends. Remember that time I accidentally spilled an entire glass of water on my setup during a stream? This feels like that but for Gap's bank account.

Old Navy to the Rescue?

Okay so Old Navy is apparently the MVP here. Sales are up comparable sales are up. The brand's 'New Moves' campaign is bringing the celebrities like Lindsay Lohan and Dylan Efron! Denim and active wear are carrying them. The Old Navy numbers are positive even though Banana Republic and Athleta are not doing too good. I stan Lindsay Lohan she could probably fix the economy if she wanted to.

Banana Republic and Athleta...Needs Some Love

Banana Republic is still struggling to find its safari chic soul with sales down and comparable sales flat. Athleta is also not performing well they're working through inventory and not hitting the mark with their core audience. Gap if you're reading this maybe try a collab with… me? A Pokimane themed athleisure line? Think about it. It's free real estate!