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Gap maintains forecast as 2Q profit falls

Gap is keeping its fiscal-year profit forecast unchanged after further struggles in the second quarter marked by weakness at its namesake and Banana Republic stores that offset rising sales at Old Navy.

The San Francisco company also said Thursday its plan to close 175 Gap stores in North America, as well as some locations in Europe, will cost a bit less than it expected.

During the quarter, the company said it would close some Gap locations as it tries to strengthen the brand, with most of the closures coming by the end of January. It closed 26 of those stores over the three months that ended on Aug. 1 and opened six more. The company will also eliminate 250 positions at its headquarters. Gap now expects USD130 million to USD140 million in charges connected to those moves, down from an estimate of USD140 million to USD160 million.

(Source: CNBC)