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President Trump Announces New Reciprocal Tariffs On Dozens Of Nations
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Gap sinks after warning of a $150 million hit to operating income from tariffs

The legacy retailer topped Q1 estimates but said price hikes may be needed to offset rising trade costs.

Nia Warfield

Gap shares plunged more than 19% Friday morning after the Y2K-era retailer posted a Q1 beat but warned new tariffs could deal a heavy blow to its bottom line.

The retailer said recently announced 30% duties on imports from China and a 10% levy on goods from other countries could raise costs by between $250 million and $300 million without mitigation. So far, management thinks it can offset about half of those costs, but still expects a $100 million to $150 million hit to operating income, likely surfacing in the back half of the year.

For Q1, Gap reported earnings per share of $0.51, topping the $0.45 expected. Revenue landed at $3.46 billion versus a $3.42 billion forecast. The sell-off erased the stock’s 2025 gains, now down nearly 5% on the year.

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Nike sinks to lowest level since 2014 after warning of “challenged” sales environment in Q4 report

Did Nike do it?

Investors had a mixed reaction after the global sports apparel company reported its fourth quarter earnings on Tuesday after the bell. Shares initially rose 5% as Nike beat out Wall Street expectations amid a hefty tariff refund bonus. However, the stock then sank to its lowest level since August 2014 in postmarket trading.

Here are the Q4 numbers:

  • Revenue of $11.0 billion (estimate: $10.8 billion).

  • Adjusted earnings per share of $0.20 (estimate: $0.12).

Ahead of this report, Nike warned that results would be flattered by a one-time tariff refund (now estimated at roughly $0.52 per share for the bottom line). That gave the company an extra cushion in snapping its streak of seven quarters of year-over-year profit declines.

Over the past year, the company had been punished by tariffs on imported goods, stagnant consumer spending, and increasing competition from other footwear brands like New Balance, Adidas, and Hoka.

Outgoing CFO Matthew Friend deemed it an “increasingly challenging operating environment, where sell-through remains challenged.”

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