On August 28, Gap, Inc rose 13.95% in pre-market trading, trading at $23.65/share, with turnover of $150,800. The surge was driven by a triple catalyst of better-than-expected Q2 earnings, an upward revision to full-year guidance, and a major leadership appointment at its largest brand.

Gap reported fiscal Q2 adjusted EPS of $0.52, beating the analyst consensus estimate of $0.48 by 8.33%. The company raised its full-year adjusted EPS guidance to a range of $2.35 to $2.45, above the prior FactSet estimate of $2.32. The core Gap brand delivered Q2 comparable sales growth of 10%, marking its 11th consecutive quarter of growth. Revenue came in at $3.65 billion, slightly below the $3.69 billion estimate.

Additionally, the company appointed industry veteran Michael Francis as new CEO of Old Navy, its largest brand generating nearly 60% of total revenue. Market concerns over Old Navy's persistent underperformance had previously pressured shares, with multiple institutions downgrading the stock. The convergence of earnings upside, raised guidance, and management renewal drove the sharp pre-market rally.

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