Gap Inc. reported its first quarter fiscal 2025 financial results, highlighting a 2% increase in net sales to $3.5 billion compared to the previous year. Comparable sales also saw a 2% rise year-over-year. However, store sales remained flat, with the company maintaining approximately 3,500 store locations across over 35 countries, of which 2,496 are company-operated. Online sales performed strongly with a 6% increase, representing 39% of total net sales. The company's gross margin improved by 60 basis points to 41.8%, supported by stable merchandise margins and a leverage of 60 basis points in rent, occupancy, and depreciation as a percentage of sales. Operating expenses were recorded at $1.2 billion, while operating income reached $260 million, resulting in an operating margin of 7.5%. Gap Inc. achieved a net income of $193 million, with diluted earnings per share of $0.51. The effective tax rate for the quarter was 26.6%. The company ended the quarter with cash, cash equivalents, and short-term investments totaling $2.2 billion, marking a 28% increase from the prior year. Looking ahead, Gap Inc. anticipates net sales for the second quarter of fiscal 2025 to remain approximately flat year-over-year. The gross margin is expected to be similar to the first quarter's performance, with operating expenses as a percentage of net sales projected to leverage slightly compared to the previous year.