Gap’s decision to pivot and make face masks put $130 million in its registers

Men wearing face masks walk past a Gap store at a shopping area, as the country is hit by an outbreak of the new coronavirus, in Beijing, China February 7, 2020.

Jason Lee | Reuters

The apparel maker Gap Inc. pivoted its supply chain early on in the coronavirus pandemic to make face masks. And it is, quite literally, paying off. 

The company said Thursday when it reported quarterly earnings that it brought in $130 million in sales during the period for its face masks. That includes sales to individuals and in bulk to businesses. The city of New York, the state of California and Kaiser Permanente are some of its clients, the company said. 

During the quarter ended Aug. 1, Gap’s total sales fell about 18% to $3.28 billion from $4 billion a year ago. Its online sales surged 95%. But those results were weighed down by the weakness at its stores, which were forced to shut for part of the quarter. 

Each of Gap’s brands — including its namesake banner, Banana Republic and Old Navy — currently have their own masks available in stores and online, in various patterns and colors. 

Chief Executive Sonia Syngal said during an earnings conference call that Gap is currently the No. 1 search result on Google for “face mask style guide.” She said Gap scaling this business is “the ultimate example of how we want to operate as a culture.” 

Early on in the pandemic, face masks were in short supply. A number of retailers such as Anthropologie and Madewell looked for opportunities to get involved, especially as the benefits of wearing face coverings became clearer. Some cities and states have rolled out mask mandates, since then, to try to curb the spread of Covid-19, which can be transmitted through respiratory droplets from person to person. 

Gap shares climbed around 4% in after-hours trading Thursday, as the retailer reported better-than-expected sales and a narrower-than-expected loss for its fiscal second quarter. Its stock has fallen roughly 1% year-to-date. 

The company’s strong performance online helped Gap win 3.5 million new customers, up over 165% from a year ago. 

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