The Gap Plummets on Downside Guidance (GPS)

Shares of The Gap Inc. GPS are trading lower in the after-hours trade following the release of the company's Q1 earnings results. Currently, shares are lower by 12.80%, trading at $20.31; they closed the regular session higher by 0.91%, at $23.29. The Gap said that Q1 EPS was $0.40 on revenues of $3.29 billion; the Street was looking for $0.39 per share on revenues of $3.26 billion. Revenues decreased 1.0% year over year. The company also issued downside guidance for FY 2012, saying it now sees EPS of $1.40-1.50; the Street was at $1.83 per share. "While we acknowledge that costing pressure is impacting our business, we're working hard to navigate this short-term macro challenge to our profitability in the current fiscal year," said Glenn Murphy, chairman and chief executive officer of Gap Inc. "That said, our strategy remains the same -- to deliver consistent, steady growth in North America while investing in our long-term global initiatives, especially in online and international." The company repurchased 25 million shares during the quarter for a total of $548 million. The Gap, Inc. is a global specialty retailer offering clothing, accessories, and personal care products for men, women, children, and babies under the Gap, Old Navy, Banana Republic, Piperlime, and Athleta brands.