Online sales at Gap Inc., No. 20 in the Internet Retailer 2018 Top 500, are expected to hit $3.5 billion this year, a 12.9% increase over 2017 e-commerce sales, said CEO Art Peck, during a conference call with analysts.
However, the apparel retailer disappointed investors with a 4% dip in the namesake brand’s overall sales, despite growth in its Old Navy, Banana Republic and Athleta brands. Total sales at Gap Inc. rose 7.5% to $4.1 billion for the second quarter ending August 4, but the company didn’t break out an e-commerce figure besides noting that growth was strong online.
Old Navy rolled out options for buy online, pickup in store to more locations during the last quarter. The apparel retail brand currently has the lowest online penetration of all of Gap Inc.’s portfolio, but serves as an opportunity for growth, Peck said.
In other e-commerce earnings news:
- Urban Outfitters Inc. (No. 39) reported double-digit online revenue growth year over year for each of its brands, which include Anthropologie and Free People. But the retailer didn’t disclose exact figures. Traffic, conversion rates and average order value all grew for the quarter. Urban Outfitters’ brands’ digital customer counts increased 20% over the prior year, said Trish Donnelly, Urban Outfitters’ global CEO. At Anthropologie, 60% of home goods sales now come from online shoppers, said Andrew Carnie, Anthropologie home, garden and international president. Profits across the business also increased for the quarter—20% year over year—but rising delivery expenses from the e-commerce sales offset some of that growth.
- 1-800-Flowers.com Inc.’s (No. 66) e-commerce revenue rose 2.8% to $921.8 million for its fiscal year, which ended July 1. However, the retailer’s reported e-commerce number includes both online and telephone sales. Quarterly e-commerce sales were up slightly, 0.4% to $192.1 million.
- Estee Lauder Cos. Inc. (No. 70) reported a 60% increase in its global online business for its fiscal year, which ended June 30. The growth was spread across its brand sites, as well as through wholesale channels and platforms like Tmall. In the U.S. and China, online sales make up more than 20% of total sales, and, globally, 10% of sales are generated through e-commerce.
- Target Corp. (No. 17) posted 41% e-commerce gains for the quarter, with two-thirds of the growth fulfilled from stores. The gross margin dropped 0.1 percentage points as those fulfillment costs rose.
- Kohl’s Corp. (No. 18) reported a “mid-teen increase” in online sales for the second quarter, alongside an increase in same-store sales that surpassed analyst projections.
- Lowe’s Cos. Inc. (No. 21) announced plans to close its Orchard Supply retail locations as it focuses on omnichannel fulfillment efforts. The hardware retailer announced that 60% of its e-commerce transactions are picked up in stores. However, it’s also opening its first direct fulfillment center this fall to send online orders to customers more efficiently.