蓋璞 (GPS) 2023 Q1 法說會逐字稿

Good afternoon, ladies and gentlemen. My name is Abby, and I will be your conference operator today. I would like to welcome everyone to the Gap Inc. First Quarter 2023 Earnings Conference Call. (Operator Instructions) I would now like to introduce your host, Cammeron McLaughlin, Head of Investor Relations.

女士們先生們，下午好。我叫艾比，今天我將擔任你們的會議接線員。歡迎大家參加 Gap Inc. 2023 年第一季度收益電話會議。 （操作員說明）我現在想介紹您的主持人，投資者關係主管 Cammeron McLaughlin。

Good afternoon, everyone. Welcome to Gap Inc.'s First Quarter Fiscal 2023 Earnings Conference Call. Before we begin, I'd like to remind you that the information made available on this conference call contains forward-looking statements that are subject to risks that could cause our actual results to be materially different. For information on factors that could cause our actual results to differ materially from any forward-looking statements as well as the description and reconciliation of any financial measures not consistent with generally accepted accounting principles, please refer to the cautionary statements contained in our latest earnings release, the risk factors described in the company's annual report on Form 10-K filed with the Securities and Exchange Commission on March 14, 2023, and any subsequent filings with the Securities and Exchange Commission, all of which are available on gapinc.com. These forward-looking statements are based on information as of today, May 25, 2023, and we assume no obligation to publicly update or revise our forward-looking statements.

大家下午好。歡迎來到 Gap Inc. 的 2023 財年第一季度收益電話會議。在我們開始之前，我想提醒您，本次電話會議中提供的信息包含前瞻性陳述，這些陳述存在風險，可能導致我們的實際結果出現重大差異。有關可能導致我們的實際結果與任何前瞻性陳述存在重大差異的因素的信息，以及任何不符合公認會計原則的財務措施的描述和調節，請參閱我們最新的收益發布中包含的警示性聲明，公司於2023年3月14日向美國證券交易委員會提交的10-K表格年度報告中描述的風險因素，以及隨後向美國證券交易委員會提交的任何文件，所有這些都可以在 gapinc.com 上找到。這些前瞻性陳述基於截至今天（2023 年 5 月 25 日）的信息，我們不承擔公開更新或修改我們的前瞻性陳述的義務。

Joining me on the call today are Interim Chief Executive Officer, Bobby Martin; and Chief Financial Officer, Katrina O'Connell.

今天和我一起參加電話會議的是臨時首席執行官 Bobby Martin；和首席財務官 Katrina O'Connell。

With that, I'll turn the call over to Bobby.

有了這個，我會把電話轉給鮑比。

Thank you, Cammeron, and good afternoon, everyone. Thanks for joining us today. Consistent with what you've heard from us over the last few quarters, we continue to take the necessary actions to drive critical change at Gap Inc. to further improve the trajectory of our business and to get us back on a path toward delivering consistent results. We are improving near-term execution and requiring a much deeper and integrated focus on the customer to unleash each brand's potential, also simplifying our operating structure and model, reducing costs, improving speed of decision-making and unlocking our creative muscle and modernizing our core capabilities that have been on Gap Inc.'s road map for far too long.

謝謝你，Cammeron，大家下午好。感謝您今天加入我們。與您在過去幾個季度從我們這裡聽到的一致，我們將繼續採取必要的行動來推動 Gap Inc. 的重大變革，以進一步改善我們的業務軌跡並讓我們回到實現一致結果的道路上.我們正在提高近期執行力，需要更深入、更全面地關注客戶，以釋放每個品牌的潛力，同時簡化我們的運營結構和模式，降低成本，提高決策速度，釋放我們的創造力，使我們的核心現代化Gap Inc. 路線圖上的功能已經存在太久了。

I understand that we have surfaced these issues before, and what I would say is simply this work has been derailed for far too long, and it is imperative that we get after it in earnest. The need for change is permeating the organization, and I am very pleased that our teams are embracing the work and behaviors needed to get us there. The leadership team is committed to getting the work done and have put structure, process and leadership accountability in place to ensure that we do.

我知道我們之前已經提出過這些問題，我想說的是這項工作已經偏離軌道太久了，我們必須認真對待它。變革的需求滲透到組織中，我很高興我們的團隊正在接受實現這一目標所需的工作和行為。領導團隊致力於完成工作，並製定了結構、流程和領導問責制，以確保我們做到這一點。

Now let me give you a little more specific insight to the actions that we have been taking. First, we took immediate action to improve our near-term execution and brand performance. We have moved quickly and effectively at clearing excess inventory, improving assortment, particularly at Old Navy and Gap, resulting in share gains in both women's and baby in Q1. The company delivered over 600 basis points of adjusted operating margin expansion compared to last year, driven by significantly improved gross margin from the reduction of excessive air freight expense and improved promotional activity as well as adjusted SG&A leverage. And our balance sheet is stronger.

現在讓我更具體地介紹一下我們一直在採取的行動。首先，我們立即採取行動來改善我們的近期執行力和品牌績效。我們在清理過剩庫存、改善分類方面採取了快速有效的行動，尤其是在 Old Navy 和 Gap，從而在第一季度實現了女裝和嬰兒裝的份額增長。與去年相比，該公司實現了超過 600 個基點的調整後營業利潤率增長，這主要得益於減少過多的空運費用、促銷活動的改善以及調整後的 SG&A 槓桿率顯著提高了毛利率。我們的資產負債表更強大。

We ended the first quarter with nearly 40% more cash than last year, almost 30% less inventory than last year, and we paid off $100 million of our outstanding ABL balance just last week while also continuing to deliver an attractive quarterly dividend to our shareholders.

第一季度結束時，我們的現金比去年增加了近 40%，庫存比去年減少了近 30%，我們僅在上週還清了 1 億美元的未償還 ABL 餘額，同時還繼續為股東提供有吸引力的季度股息.

Now let me speak to each of our brands. Starting with Old Navy, comparable sales were down 1%. Old Navy's momentum continued into the first quarter with market share gains driven by strength in women's as well as a reversal of trend in the baby business that was offset by softness in active and kids. The Old Navy team under Haio Barbeito's leadership remain focused on stabilizing the core and elevating execution, which contributed to improved margins resulting from its leaner inventory position and balanced assortments. Styles with a clear fashion point of view and diversified end use like woven tops and pants performed well, giving customers the option to go from casual to dressed up thanks to outfitting cues focused on versatility. The team also continues to lean into its responsive capabilities in order to place inventory buys more efficiently and remain flexible to chase into demand or pivot if the customer needs shift.

現在讓我談談我們的每個品牌。從 Old Navy 開始，可比銷售額下降了 1%。 Old Navy 的勢頭一直持續到第一季度，市場份額的增長受到女裝業務的強勁推動，以及嬰兒業務趨勢的逆轉被運動和兒童業務的疲軟所抵消。 Haio Barbeito 領導下的 Old Navy 團隊仍然專注於穩定核心業務和提升執行力，這有助於提高利潤率，這得益於其更精簡的庫存狀況和平衡的分類。具有清晰時尚觀點和多樣化最終用途的款式（如梭織上衣和褲子）表現良好，由於注重多功能性的著裝提示，客戶可以選擇從休閒到正裝。該團隊還繼續依靠其響應能力，以便更有效地進行庫存購買，並保持靈活性以追趕需求或在客戶需求轉變時進行調整。

On Gap Brand, comparable sales were up 1%, driven by continued strength in women's, a modest improvement in baby and offset by weakness in kids and active. Gap Brand's focus on amplifying its icons is truly resonating as the team focuses on reintroducing the most modern versions of its iconic styles. This shows up as updating styles like our women's silver faux leather jean and on-trend take on our classic cheeky straight denim offering. And I'm encouraged by product improvement in other categories as well, including denim, woven tops and dresses, which showed up with increased versatility. The team uses responsive levers to chase in the best-selling women's denim like the Baby Boot and high-rise stride as well as trending woven tops, further driving growth in these categories.

Gap 品牌的可比銷售額增長了 1%，這主要是由於女裝的持續強勁、嬰兒的適度改善以及被兒童和運動服的疲軟所抵消。 Gap Brand 專注於擴大其標誌性，這確實引起了共鳴，因為該團隊專注於重新引入其標誌性風格的最現代版本。這顯示為更新款式，例如我們的女式銀色人造皮革牛仔褲和流行的經典直筒牛仔布產品。我也對其他類別的產品改進感到鼓舞，包括牛仔布、梭織上衣和連衣裙，它們的多功能性有所提高。該團隊使用反應靈敏的槓桿來追逐最暢銷的女式牛仔布，如嬰兒靴和高腰闊腿褲以及流行的梭織上衣，進一步推動了這些類別的增長。

Moving to Banana Republic. Comparable sales were down 8% on top of an outsized positive 27% comp last year. While still early on its journey, Banana Republic continues to make progress establishing itself as a premium lifestyle brand and is resonating with our customers. This March, it unveiled BR Home with a curated collection of rugs, bedding, decor and more, all capitalizing on the BR customers' appreciation for great style, design and quality. And leveraging the deep home lifestyle talent and expertise of the Banana Republic leadership team, we look forward to more expanded collection in the future.

搬到香蕉共和國。可比銷售額在去年 27% 的大幅正增長的基礎上下降了 8%。 Banana Republic 雖然仍處於起步階段，但它繼續取得進展，將自己打造為優質生活方式品牌，並引起了我們客戶的共鳴。今年 3 月，它推出了 BR Home，其中包含一系列精選的地毯、床上用品、裝飾品等，所有這些都充分利用了 BR 客戶對卓越風格、設計和品質的欣賞。並利用 Banana Republic 領導團隊深厚的家居生活方式人才和專業知識，我們期待未來有更多的產品系列。

And finally, Athleta, which posted comparable sales of negative 13%, which were below plan for the quarter. As we discussed last quarter, Athleta's near-term performance was negatively impacted by continued product acceptance challenges, including color, print and pattern misses and from straying too far from its performance DNA. Delivering the best product for our customers is the highest priority, and while the team is focused on making improvements in the assortment, we know it will take time for those changes to fully take hold.

最後是 Athleta，其可比銷售額為負 13%，低於本季度的計劃。正如我們上個季度所討論的那樣，Athleta 的近期業績受到持續的產品驗收挑戰的負面影響，包括顏色、印刷和圖案缺失以及偏離其性能 DNA 太遠。為我們的客戶提供最好的產品是重中之重，雖然團隊專注於改進產品種類，但我們知道這些更改需要時間才能完全生效。

While we continue our search for a new leader for Athleta, we are leveraging the great talent currently at the brand, including our new Chief Creative Officer, Julia Leach, as well as some of our best merchandising and product talent from across our portfolio of brands. Collectively, they are leaning in and making improvements where we can, including better presentation of the product that is working, and elevating our marketing and creative expression.

在我們繼續為 Athleta 尋找新的領導者的同時，我們正在利用該品牌目前的優秀人才，包括我們新任首席創意官 Julia Leach，以及來自我們品牌組合的一些最佳營銷和產品人才.總的來說，他們正在向我們傾斜並在我們力所能及的地方做出改進，包括更好地展示有效的產品，以及提升我們的營銷和創意表達。

And across Gap Inc., we are still watching the channel shifts closely. While online sales were down single digits in Q1, they are up close to 40% from pre-pandemic levels in Q1 of 2019. As the consumer continues to shift back to stores, we remain focused on delivering the optimal omni experience for our customers across all brands and all channels. Second, we've made significant change to our organizational structure and are actively improving our operating model to unlock period of muscle, heightened accountability and empower talent by removing bureaucracy, complexity and outdated processes while also reducing cost.

在 Gap Inc.，我們仍在密切關注渠道轉變。雖然在線銷售額在第一季度下降了個位數，但與 2019 年第一季度大流行前的水平相比增長了近 40%。隨著消費者繼續回到商店，我們仍然專注於為我們的客戶提供最佳的全方位體驗所有品牌和所有渠道。其次，我們對我們的組織結構進行了重大改變，並積極改進我們的運營模式，以通過消除官僚主義、複雜性和過時的流程，同時降低成本，釋放力量、加強問責制並賦予人才權力。

These changes are pivotal in restoring our strengths and priority around design, innovation, style and trend. We flattened the organization by reducing layers from 12 to 8 and increasing the average span of control from 2 people to 4, still with the intent of getting to 5 or better, informed by best-in-class benchmarks, all of this to address execution inefficiency and improve decision-making quality and speed.

這些變化對於恢復我們在設計、創新、風格和趨勢方面的優勢和優先權至關重要。我們通過將層級從 12 層減少到 8 層並將平均控制跨度從 2 人增加到 4 人來扁平化組織，仍然打算達到 5 人或更好，以一流的基準為依據，所有這些都是為了解決執行問題效率低下，提高決策質量和速度。

Each of our brands now have consistent structures built around our product, our customer and our creative excellence with clear road maps and mandates. We believe this work will ultimately show up in improvements in our sales and margin performance over the long term and again, most importantly, in creative and product execution.

我們的每個品牌現在都圍繞我們的產品、我們的客戶和我們的卓越創意建立了一致的結構，並有明確的路線圖和任務。我們相信這項工作最終將體現在我們的長期銷售和利潤率表現的改善上，最重要的是，在創意和產品執行方面。

Fundamental shifts included combining merchandising and inventory management under one leader to oversee the end-to-end process fueled by consumer insights; bringing channels together under the commerce and experience lead to drive omni-thinking in the end-to-end consumer experience and splitting marketing leadership into 2 roles, 1 focused on creative and brand identity, and 1 focused on execution and analytics. And we have also centralized G&A functions that were previously embedded in the brands to create efficiencies and better leverage scale and expertise of our portfolio. These changes result in eliminating approximately 1,800 positions and when combined with our earlier actions last fall, reflect approximately 25% of our headquarter roles, a significant contributor to nearly $550 million in estimated annualized savings on a cumulative basis.

根本性的轉變包括將銷售和庫存管理結合在一位領導之下，以監督由消費者洞察推動的端到端流程；將渠道整合到商業和體驗領導下，推動端到端消費者體驗的全方位思考，並將營銷領導分為兩個角色，一個專注於創意和品牌識別，另一個專注於執行和分析。我們還集中了以前嵌入品牌中的 G&A 功能，以提高效率並更好地利用我們產品組合的規模和專業知識。這些變化導致裁員約 1,800 人，加上我們去年秋天早些時候採取的行動，反映了我們總部職位的約 25%，這是累計估計年化節省近 5.5 億美元的重要貢獻者。

I know we all can understand, these decisions are always very, very difficult to make, especially when saying goodbye to team members that we care about. Beyond these organizational changes, the bigger payback will come when we show up as a more informed, faster and more creative company, delivering brand and cultural relevance to our customers.

我知道我們都能理解，這些決定總是非常非常難以做出，尤其是在與我們關心的團隊成員道別時。除了這些組織變革之外，當我們成為一家消息靈通、速度更快、更具創造力的公司，為我們的客戶提供品牌和文化相關性時，更大的回報將會到來。

We have organized not just to improve the cost structure of this company but with an eye toward best-in-class industry standards and setting ourselves up to deliver long-term results. To be clear, this is not a one-and-done cost-cutting exercise. We are after a mindset and cultural shift that will be part of our evolution as we go forward. The teams are now in place, and in consistent pursuit of efficiency, we will continue to look at additional opportunities to rationalize our technology and marketing investments and exploring ways to further optimize our cost structure longer term. More to come as the team gets in deeper into this work.

我們組織起來不僅是為了改善這家公司的成本結構，而且著眼於一流的行業標準，並為實現長期成果做好準備。需要明確的是，這不是一次性的成本削減活動。我們正在尋求一種思維方式和文化轉變，這將成為我們前進過程中的一部分。這些團隊現已就位，為了始終如一地追求效率，我們將繼續尋找更多機會來合理化我們的技術和營銷投資，並探索進一步優化我們的長期成本結構的方法。隨著團隊對這項工作的深入，還會有更多。

Thirdly, we are modernizing our capabilities to build a healthier company at the core and ultimately change the trajectory of our business. Through these improved capabilities, we are focused on key product and market functions, including reestablishing core merchandising processes and pricing architectures, amplifying and leveraging customer insights and analytics and leaning in further to our vendor partners and our product development processes as we further elevate our responsive capabilities.

第三，我們正在使我們的能力現代化，以建立一個更健康的核心公司，並最終改變我們的業務軌跡。通過這些改進的能力，我們專注於關鍵產品和市場功能，包括重建核心銷售流程和定價架構，擴大和利用客戶洞察力和分析，並進一步向我們的供應商合作夥伴和我們的產品開發流程傾斜，同時我們進一步提升我們的響應能力能力。

Lastly, to bring leadership, structure and accountability to ensure we drive this work to completion, we have put a transformation office in place under the Gap Inc. leadership team, and we've engaged external consulting partners to even further drive rigor, processes and day-to-day discipline to support the team through this period of significant change. We have also aligned a significant portion of our incentive compensation this year to the achievement and completion of our cost transformation efforts. Our leaders and our teams are committed to this change, and I'm proud of the progress to date.

最後，為了確保領導力、結構和問責制，以確保我們推動這項工作完成，我們在 Gap Inc. 領導團隊下設立了一個轉型辦公室，我們還聘請了外部諮詢合作夥伴，以進一步推動嚴謹、流程和日常紀律支持團隊度過這一重大變革時期。今年，我們還將激勵薪酬的很大一部分與成本轉型工作的實現和完成掛鉤。我們的領導者和我們的團隊致力於這一變革，我為迄今為止取得的進展感到自豪。

And finally, before I turn the call to Katrina, I want to address our CEO search and the comments made by our Lead Independent Director, Mayo Shattuck, in our earnings press release today. When I took the role of interim CEO in July, I did not expect to still be speaking to you on our first quarter earnings call, but this only underscores how strongly the Board is committed to appointing the right person as our next CEO, one who has passion, strong vision and customer obsession that will take this company forward. We are deeply engaged toward the appointment, and look forward to the time we will introduce you to the new CEO of Gap Inc.

最後，在我打電話給卡特里娜颶風之前，我想談談我們的 CEO 搜索以及我們的首席獨立董事 Mayo Shattuck 在今天的收益新聞稿中發表的評論。當我在 7 月份擔任臨時 CEO 時，我沒想到還會在我們的第一季度財報電話會議上與您交談，但這只是強調了董事會對任命合適的人選作為我們的下一任 CEO 的堅定承諾，一個擁有激情、強烈的遠見和對客戶的痴迷，這將推動這家公司向前發展。我們對任命深感興趣，並期待著有時間向您介紹 Gap Inc. 的新任首席執行官。

Let me move us on, but I hope this provided a bit more clarity around our commitment to shoring up the foundation of this company for the long term by lowering our cost structure, building a culture of creativity and empowerment and reorienting our business toward the customer. These types of foundational changes pave the way for a future CEO to take over a business that is healthier, more productive and ready to compete and win.

讓我繼續說下去，但我希望這能讓我們更清楚地了解我們通過降低成本結構、建立創造力和賦權文化以及將我們的業務重新定位為客戶來長期鞏固這家公司基礎的承諾.這些類型的基礎性變革為未來的 CEO 接管一家更健康、更有生產力、準備好競爭和獲勝的企業鋪平了道路。

And with that, Katrina, I'll pass it over to you.

有了這個，卡特里娜颶風，我會把它傳遞給你。

Thank you, Bobby, and thanks, everyone, for joining us this afternoon. The actions we are taking to significantly reduce excess inventory, improve category and assortment balance, transform and optimize our operating structure and significantly reduce operating expenses while further fortifying our balance sheet have allowed us to enter fiscal 2023 better positioned.

謝謝 Bobby，也謝謝大家今天下午加入我們。我們正在採取措施大幅減少過剩庫存、改善品類和分類平衡、轉變和優化我們的運營結構並大幅降低運營費用，同時進一步鞏固我們的資產負債表，這使我們能夠更好地進入 2023 財年。

During the first quarter, we delivered net sales in line with our expectations driven by continued women's category strength at Gap and Old Navy despite the weaker sales at Athleta, over 600 basis points of adjusted operating margin expansion as we drove down excessive airfreight expense and delivered significantly improved promotional activity, most notably at Old Navy, and leveraged adjusted SG&A, reduced inventory down over 27% year-over-year, which was only up 3% versus first quarter 2019 and ended the quarter with cash and equivalents up 38% from last year to nearly $1.2 billion.

在第一季度，儘管 Athleta 的銷售疲軟，但由於 Gap 和 Old Navy 的女性類別持續強勁，我們的淨銷售額符合我們的預期，由於我們降低了過多的空運費用並交付，調整後的營業利潤率增長超過 600 個基點促銷活動顯著改善，尤其是在 Old Navy，並利用調整後的 SG&A 槓桿，庫存同比減少 27% 以上，僅比 2019 年第一季度增長 3%，本季度末現金和等價物比 2019 年第一季度增長 38%去年達到近 12 億美元。

While we believe we are making progress to better position our model to deliver for the long term, we continue to take a prudent approach in planning and managing our business in light of what continues to be an uncertain macro and consumer environment. We remain focused on the levers and opportunities in our control to deliver on behalf of our customers, employees and shareholders.

雖然我們相信我們正在取得進展以更好地定位我們的模型以實現長期交付，但鑑於仍然不確定的宏觀和消費者環境，我們將繼續採取審慎的方法來規劃和管理我們的業務。我們仍然專注於我們控制的槓桿和機會，以代表我們的客戶、員工和股東交付。

Let me start now with our first quarter results. First quarter net sales of $3.3 billion decreased 6% versus last year and were consistent with our expectations for first quarter sales to be down mid-single digits. As a reminder, the sale of Gap China at the beginning of the first quarter had a 2 point negative impact to net sales growth, and there was also a 1 point foreign exchange headwind. Excluding Gap China sales of approximately $60 million from Q1 last year and the foreign exchange headwind, total company net sales would have been down 3%.

現在讓我從第一季度的業績開始。第一季度淨銷售額為 33 億美元，與去年同期相比下降 6%，符合我們對第一季度銷售額下降中個位數的預期。提醒一下，一季度初Gap中國的銷售對淨銷售額增長產生了2個百分點的負面影響，另外還有1個外匯逆風。排除去年第一季度約 6000 萬美元的 Gap 中國銷售額和外匯逆風，公司淨銷售額總額將下降 3%。

Comparable sales were down 3% in the first quarter. Store sales decreased 4% from the prior year. Online sales decreased 9% versus last year and were up 39% compared to pre-pandemic levels in 2019. Online represented 37% of total sales in the first quarter.

第一季度可比銷售額下降了 3%。商店銷售額比上年下降 4%。在線銷售額與去年相比下降了 9%，與 2019 年大流行前的水平相比增長了 39%。在線銷售額佔第一季度總銷售額的 37%。

Turning to sales by brand, starting with Old Navy. Sales in the first quarter of $1.8 billion were down 1% from last year. Compared to 2019, Old Navy sales were up 2% in the quarter. Although we believe Old Navy continues to experience demand softness from its lower income consumers, we're pleased to deliver first quarter comparable sales down 1%, which was a continued improvement from fiscal 2022, driven by strength in women's and a modest improvement in baby, offset by continued softness in active and kids. Old Navy continued to gain share in the quarter, driven largely by market share gains in women's and the kids and baby category. We continue to believe that Old Navy remains well positioned given its value positioning in the marketplace.

轉向品牌銷售，從 Old Navy 開始。第一季度的銷售額為 18 億美元，比去年下降 1%。與 2019 年相比，Old Navy 本季度的銷售額增長了 2%。儘管我們認為 Old Navy 繼續經歷低收入消費者的需求疲軟，但我們很高興第一季度的可比銷售額下降了 1%，這比 2022 財年持續改善，這主要得益於女性業務的強勁增長和嬰兒業務的適度改善，被活躍和兒童的持續柔軟所抵消。 Old Navy 在本季度繼續增加份額，這主要是受女性和兒童及嬰兒類別市場份額增加的推動。鑑於其在市場上的價值定位，我們仍然相信 Old Navy 仍然處於有利地位。

Gap Brand total sales were $692 million. Excluding the 8 point negative impact related to the sale of Gap China, the 3 point negative impact from foreign exchange headwinds and the 1 point negative impact due to the shutdown of Yeezy Gap, sales were down 1% versus last year, largely driven by store closures in North America. Gap Brand comparable sales were up 1%, driven by continued strength in women's, a modest improvement in baby, offset by continued weakness in active and kids. Gap Brand continued to gain market share in women's as reinvented icons are resonating with consumers.

Gap Brand 的總銷售額為 6.92 億美元。剔除與 Gap China 銷售相關的 8 點負面影響、外匯逆風帶來的 3 點負面影響以及 Yeezy Gap 停產帶來的 1 點負面影響，銷售額較去年下降 1%，主要受門店推動北美關閉。 Gap 品牌的可比銷售額增長了 1%，這主要得益於女裝業務的持續強勁、嬰兒業務的適度改善，但被運動和兒童業務的持續疲軟所抵消。 Gap Brand 繼續獲得女裝市場份額，因為重新設計的標誌引起了消費者的共鳴。

Banana Republic sales were $432 million in the first quarter with comparable sales down 8% on top of a positive 27% comp last year. While the transformation of BR into an elevated lifestyle brand continues to take hold and resonate, the brand is lapping outsized growth last year, driven by post-COVID shift in consumer preferences, which is impacting year-over-year growth.

Banana Republic 第一季度的銷售額為 4.32 億美元，可比銷售額在去年 27% 的正增長基礎上下降了 8%。雖然 BR 向高端生活方式品牌的轉變繼續佔據主導地位並引起共鳴，但受 COVID 後消費者偏好轉變的推動，該品牌去年實現了超額增長，這影響了同比增長。

Athleta sales of $321 million were down 11% from the prior year or an increase of 45% compared to 2019 pre-pandemic levels. Comparable sales were down 13%. As we told you last quarter, Athleta has had product acceptance challenges, which we believe are impacting results. While we know it will take at least a few quarters to make meaningful changes to the assortment, the team has been at work to improve product presentation and creative with an emphasis on the performance DNA that Athleta is known for.

Athleta 的銷售額為 3.21 億美元，比上年下降 11%，與 2019 年大流行前的水平相比增長 45%。可比銷售額下降了 13%。正如我們上個季度告訴您的那樣，Athleta 遇到了產品接受度方面的挑戰，我們認為這些挑戰正在影響結果。雖然我們知道至少需要幾個季度才能對產品類別做出有意義的改變，但該團隊一直在努力改進產品展示和創意，重點是 Athleta 眾所周知的性能 DNA。

Now to gross margin in the first quarter. Reported gross margin was 37.1%. Adjusted gross margin increased 570 basis points to 37.2%. Merchandise margin on an adjusted basis increased 610 basis points. This was driven by approximately 560 basis points of leverage as we lapped last year's elevated airfreight and drove our normalized air expense down, approximately 330 basis points of deleverage due to inflationary cost headwinds as we are now selling product locked in at last year's peak cotton prices. This was slightly better than the 360 basis point headwind we anticipated as we are beginning to benefit from better ocean freights and the remaining 380 basis points of leverage stemming primarily from improved promotional activity relative to last year, primarily at Old Navy. ROD, as a percentage of sales deleveraged 40 basis points versus last year.

現在是第一季度的毛利率。報告的毛利率為 37.1%。調整後的毛利率增加 570 個基點至 37.2%。調整後的商品利潤率增加了 610 個基點。這是由大約 560 個基點的槓桿率推動的，因為我們超越了去年的高空運費並降低了我們的正常空運費用，由於通脹成本逆風，我們現在銷售鎖定在去年棉花最高價格的產品，因此去槓桿化大約 330 個基點.這略好於我們預期的 360 個基點的逆風，因為我們開始受益於更好的海運，而剩餘的 380 個基點的槓桿主要來自與去年相比有所改善的促銷活動，主要是在 Old Navy。 ROD，作為銷售額的百分比，與去年相比減少了 40 個基點。

Now let me turn to SG&A. Reported SG&A in the quarter was $1.2 billion, including a $47 million gain related to the sale of our One Harrison office building, offset by $71 million in restructuring charges related to actions to optimize our operating structure, including the reduction of approximately 1,800 corporate and upper field roles. As we discussed last quarter, the actions we are taking to optimize our operating model and structure are expected to result in annualized savings of $300 million, of which half we estimate to benefit SG&A in the second half of fiscal 2023 and the remainder in the first half of fiscal 2024.

現在讓我談談 SG&A。本季度報告的 SG&A 為 12 億美元，包括與我們的 One Harrison 辦公樓出售相關的 4700 萬美元收益，被與優化我們的運營結構的行動相關的 7100 萬美元的重組費用所抵消，包括減少大約 1,800 家公司和高層現場角色。正如我們上個季度所討論的那樣，我們為優化運營模式和結構而採取的行動預計將每年節省 3 億美元，我們估計其中一半將在 2023 財年下半年使 SG&A 受益，其餘部分將在第一季度受益2024 財年的一半。

Adjusted SG&A of $1.2 billion was down 7% from last year. As a percentage of total sales, adjusted SG&A leveraged 60 basis points, driven by lower advertising expense and lower technology investments resulting from our cost saving actions late last year. Reported operating income was a loss of $10 million. Adjusted operating income, which excludes restructuring charges and the gain on sale, was $18 million in the first quarter. Adjusted operating margin improved 620 basis points from last year to 0.5% in the quarter, driven by the 570 basis point improvement in adjusted gross margin and 60 basis points of adjusted SG&A leverage. Reported EPS was a loss of $0.05. Adjusted EPS, which excludes restructuring charges and the gain on sale, was $0.01. Share count ended at 368 million.

調整後的 SG&A 為 12 億美元，比去年下降 7%。作為佔總銷售額的百分比，調整後的 SG&A 槓桿率為 60 個基點，這是由於我們去年底的成本節約行動導致廣告費用和技術投資減少。報告的營業收入虧損 1000 萬美元。不包括重組費用和銷售收益的調整後營業收入在第一季度為 1800 萬美元。調整後的營業利潤率比去年同期提高 620 個基點，在本季度達到 0.5%，這得益於調整後的毛利率提高 570 個基點和調整後的 SG&A 槓桿提高 60 個基點。報告的每股收益虧損 0.05 美元。不包括重組費用和銷售收益的調整後每股收益為 0.01 美元。股票總數為 3.68 億股。

Turning to balance sheet and cash flow. Starting with inventory. Ending inventories declined 27% in the first quarter versus last year. This includes a 17 percentage point benefit related to in-transit as we lapped the prior year supply chain challenges and 4 percentage points of decline related to pack and hold inventory. The remaining decline is primarily driven by a decrease in fashion and seasonal basic inventory. As you know, we made significant progress rightsizing inventories as we exited fiscal 2022. We remain focused in fiscal 2023 on moderating buys, leaning further into our responsive levers and continuing to integrate the inventory that was placed in pack and hold in fiscal 2022 into future assortments.

轉向資產負債表和現金流量。從庫存開始。第一季度期末庫存與去年同期相比下降了 27%。這包括與在途相關的 17 個百分點的收益，因為我們克服了上一年的供應鏈挑戰，以及與包裝和持有庫存相關的 4 個百分點的下降。剩餘的下降主要是由於時尚和季節性基本庫存的減少。如您所知，我們在 2022 財年結束時在合理調整庫存方面取得了重大進展。我們在 2023 財年仍將重點放在適度購買上，進一步傾向於我們的響應槓桿，並繼續將 2022 財年打包並持有的庫存整合到未來分類。

As a result, we are planning for inventory to be down significantly more than sales as compared to fiscal 2022. Quarter-end cash and equivalents were nearly $1.2 billion, an increase of 38% from the prior year. Net cash from operating activities was $15 million in the quarter, driven primarily by improved inventory levels and leaner buys. Capital expenditures were $117 million. Consistent with typical first quarter seasonality, free cash flow was an outflow in the quarter of approximately $102 million. We remain confident that cash flow trends will continue to normalize throughout fiscal 2023. As we told you last quarter, we expect to be positioned to pay down the $350 million draw on our asset-backed line of credit this year. In fact, last week, we paid down $100 million and intend to pay down the remaining $250 million balance throughout the remainder of the year.

因此，與 2022 財年相比，我們計劃庫存降幅遠大於銷售額。季末現金及等價物接近 12 億美元，比上年增長 38%。本季度經營活動產生的現金淨額為 1500 萬美元，主要受庫存水平提高和精簡採購的推動。資本支出為 1.17 億美元。與典型的第一季度季節性一致，自由現金流在本季度流出約 1.02 億美元。我們仍然相信，現金流趨勢將在整個 2023 財年繼續正常化。正如我們上個季度告訴您的那樣，我們預計今年將有能力支付 3.5 億美元的資產支持信貸額度。事實上，上週，我們支付了 1 億美元，並打算在今年剩餘時間內支付剩餘的 2.5 億美元餘額。

We remain committed to delivering an attractive quarterly dividend as a core component of total shareholder returns. During the quarter, we paid a dividend of $0.15 per share, and on May 9, our Board approved maintaining that $0.15 dividend for the second quarter of fiscal 2023.

我們仍然致力於提供有吸引力的季度股息，作為股東總回報的核心組成部分。在本季度，我們支付了每股 0.15 美元的股息，5 月 9 日，我們的董事會批准在 2023 財年第二季度維持 0.15 美元的股息。

Now turning to our outlook. We continue to take a prudent approach to planning in light of the continued uncertain consumer and macro environment. Starting with Q2, let me first provide an overview of factors impacting year-over-year sales comparisons in the second quarter. Gap China represented approximately $60 million in sales last year in Q2 and is expected to be an approximate 1 to 2 percentage point headwind to Gap Inc. for the quarter. We are assuming an estimated 1 point foreign exchange headwind in the second quarter. We are estimating total net sales in the second quarter to be down mid- to high single digits year-over-year, reflecting a range of outcomes based on what continues to be an uncertain macro and consumer environment.

現在轉向我們的前景。鑑於持續不確定的消費者和宏觀環境，我們繼續採取審慎的規劃方法。從第二季度開始，讓我首先概述影響第二季度同比銷售額比較的因素。 Gap 中國去年第二季度的銷售額約為 6000 萬美元，預計本季度將對 Gap Inc. 產生約 1 至 2 個百分點的不利影響。我們假設第二季度外匯逆風估計為 1 個百分點。我們估計第二季度的總淨銷售額將同比下降中高個位數，反映了基於持續不確定的宏觀和消費者環境的一系列結果。

We expect gross margin improvement in the second quarter versus last year. Compared to the 36% adjusted gross margin in the second quarter last year, we anticipate an estimated 200 basis points of leverage as we lap last year's elevated airfreight and continue to drive lower normalized air expense; an estimated 200 basis points of deleverage due to inflationary cost headwinds, primarily cotton cost headwinds similar to Q1. We expect these inflationary headwinds to moderate and become a tailwind in the back half of the year as we benefit from lower commodity prices as well as improved ocean freight rates. This 200 basis point inflationary headwind is expected to be fully offset by improved promotional activity as a result of improved inventory positions relative to last year. And ROD is expected to delever by approximately 50 basis points compared to last year.

我們預計第二季度的毛利率將比去年有所改善。與去年第二季度 36% 的調整後毛利率相比，我們預計槓桿率將達到 200 個基點，因為我們將超越去年的高空運費，並繼續推動較低的標準化空運費用；由於通脹成本逆風，主要是與第一季度類似的棉花成本逆風，估計去槓桿化 200 個基點。我們預計這些通脹逆風將在今年下半年緩和並成為順風，因為我們受益於較低的商品價格以及提高的海運費率。由於相對於去年庫存狀況有所改善，預計這 200 個基點的通脹逆風將被促銷活動的改善所完全抵消。與去年相比，ROD 預計將減少約 50 個基點。

We are planning for adjusted SG&A of approximately $1.3 billion in the second quarter largely reflecting the continued benefit of last year's savings actions offset by higher incentive compensation. As discussed previously, we expect to begin to benefit in the back half of the year from $300 million in annualized savings related to the actions we are taking to optimize our operating model and structure that we began implementing last month.

我們計劃在第二季度調整後的 SG&A 約為 13 億美元，這主要反映了去年儲蓄行動的持續收益被更高的激勵薪酬所抵消。如前所述，我們預計將在今年下半年開始受益於 3 億美元的年化節省，這些節省與我們為優化我們上個月開始實施的運營模式和結構而採取的行動有關。

Now turning to full year 2023. As a reminder on the factors impacting year-over-year comparisons, Gap China represented approximately $300 million in net sales last year, representing an approximate 2 point headwind to Gap Inc. in fiscal 2023. Fiscal 2023 will have a 53rd week, estimated to add approximately $150 million to net sales or approximately 1 point of growth. As we look to the remainder of fiscal 2023, we continue to believe net sales could be down in the low to mid-single-digit range for the year.

現在轉向 2023 年全年。提醒一下影響同比比較的因素，Gap 中國去年的淨銷售額約為 3 億美元，在 2023 財年對 Gap Inc. 造成約 2 個百分點的逆風。2023 財年將第 53 週，估計淨銷售額增加約 1.5 億美元或約 1 個百分點的增長。展望 2023 財年的剩餘時間，我們仍然認為今年的淨銷售額可能會下降到中低個位數範圍內。

Turning to gross margin. Compared to the 35% adjusted gross margin in fiscal 2022, adjusted gross margin in fiscal 2023 is expected to be driven by an estimated 200 basis points of airfreight leverage as we lap last year's elevated airfreight and continue to drive down normalized air expense. Approximately 50 basis points of deleverage versus last year stemming from inflationary cost headwinds, this is an improvement from our prior expectations of a 100 basis point headwind as we are experiencing an improvement in ocean freight rates earlier than previously planned. We anticipate approximately 250 basis points of inflationary deleverage in the first half of the year, shifting to a tailwind of approximately 150 basis points of leverage in the back half as we benefit from improved commodity costs and ocean freight rates.

轉向毛利率。與 2022 財年 35% 的調整後毛利率相比，預計 2023 財年調整後的毛利率將受到估計 200 個基點的空運槓桿率的推動，因為我們超越了去年的高空運費，並繼續壓低正常化的空運費用。由於通脹成本逆風，與去年相比，去槓桿化大約 50 個基點，這比我們之前預期的 100 個基點逆風有所改善，因為我們正在經歷比先前計劃更早的海運費率改善。我們預計今年上半年通脹去槓桿化約為 250 個基點，隨著我們受益於商品成本和海運費率的改善，下半年將轉向槓桿率約為 150 個基點的順風。

We continue to expect more than 100 basis points of margin benefit in fiscal 2023 as a result of our better inventory position and expected improved promotional activity compared to last year. And ROD as a percentage of sales is planned to be roughly flat to down approximately 50 basis points compared to last year.

由於我們的庫存狀況比去年更好，並且預計促銷活動會有所改善，因此我們繼續預計 2023 財年的利潤率將超過 100 個基點。與去年相比，ROD 佔銷售額的百分比計劃大致持平或下降約 50 個基點。

We continue to target fiscal 2023 adjusted SG&A to be down low to mid-single digits from the prior year or approximately $5.2 billion. As we communicated last quarter, the higher incentive compensation and wage inflation plan for fiscal 2023 is expected to be fully offset by approximately $250 million of the cost savings implemented in fiscal 2022. In addition, as discussed earlier, we expect to realize roughly half of the $300 million in annualized savings related to the optimization of our operating structure, including the elimination of approximately 1,800 corporate and upper field roles.

我們繼續將 2023 財年調整後的 SG&A 目標定為比上一年低至中個位數，即約 52 億美元。正如我們上個季度所傳達的那樣，2023 財年更高的激勵薪酬和工資通脹計劃預計將被 2022 財年實施的約 2.5 億美元的成本節約完全抵消。此外，如前所述，我們預計將實現大約一半的成本與優化我們的運營結構相關的年度節省 3 億美元，包括取消大約 1,800 個公司和高層職位。

We now expect capital expenditures in the range of $500 million to $525 million, down from our prior range of $500 million to $550 million, largely reflecting lower capital project investments as well as fewer store openings than previously planned. We now plan to open a net 25 to 30 Old Navy and Athleta stores in total, roughly 1/3 Old Navy stores and 2/3 Athleta stores. We continue to plan to close a net total of 50 to 55 Gap and Banana Republic stores in North America, of which approximately more than half are Gap stores and the remaining, Banana Republic stores.

我們現在預計資本支出在 5 億美元至 5.25 億美元之間，低於我們之前 5 億美元至 5.5 億美元的範圍，這主要反映了較低的資本項目投資以及低於先前計劃的新店開張。我們現在計劃淨開 25 到 30 家 Old Navy 和 Athleta 商店，大約 1/3 Old Navy 商店和 2/3 Athleta 商店。我們繼續計劃在北美關閉總共 50 至 55 家 Gap 和 Banana Republic 商店，其中大約一半以上是 Gap 商店，其餘是 Banana Republic 商店。

We are entering fiscal 2023 better positioned as a result of the actions we are taking to change the trajectory of our business not only in the near term but even more importantly, setting the company up for the long term. We are confident in the actions we're taking and believe we are taking the right steps to position Gap Inc. back on its path towards sustainable profitable growth and delivering value for our shareholders over the long term.

由於我們正在採取行動改變我們的業務軌跡，不僅在短期內，而且更重要的是，為公司的長期發展奠定基礎，我們進入 2023 財年時處於更有利的地位。我們對我們正在採取的行動充滿信心，並相信我們正在採取正確的步驟，使 Gap Inc. 重新走上可持續盈利增長的道路，並為我們的股東創造長期價值。

With that, we'll open up the line for questions. Operator?

有了這個，我們將打開問題熱線。操作員？

(Operator Instructions) Our first question comes from the line of Alex Straton from Morgan Stanley.

（操作員說明）我們的第一個問題來自摩根士丹利的 Alex Straton。

I have a couple that are probably best answered by Katrina, so both related to revenue. So on the quarter, is there any color you guys can give us on how it trended? Was it consistent? Did it strengthen or weaken as you got to the total results? And then on the 2Q guidance, it looks like you're assuming a worsening at the midpoint from the first quarter levels. Does that mean that you've seen a slowing in the business quarter-to-date? And is there any particular segment driving that?

我有幾個可能最好由卡特里娜颶風回答，所以都與收入有關。那麼在這個季度，你們有什麼顏色可以告訴我們它的趨勢嗎？一致嗎？當您獲得總結果時，它是增強還是減弱？然後在第二季度的指導中，你似乎假設第一季度水平的中點在惡化。這是否意味著您已經看到本季度迄今為止的業務放緩？是否有任何特定的部分推動了這一點？

Alex, thanks for the question. So I think on your first question, I would say, we are obviously pleased that we were able to deliver on our expectations in the first quarter for revenue. And what we observed, I think, is largely in line with what we've heard others report, which is that February was quite strong and probably benefited from the fact that it was warm everywhere.

亞歷克斯，謝謝你的提問。所以我想關於你的第一個問題，我想說，我們顯然很高興我們能夠在第一季度實現我們對收入的預期。我認為，我們觀察到的情況在很大程度上與我們聽到的其他人報告的一致，即 2 月天氣非常強勁，可能得益於各地溫暖。

And then in March, we definitely saw a similar weakening to what I think you've heard articulated largely as a result of the regional bank situation that was playing out and the impact that, that had to consumers as they tightened in March and then a little bit of a recovery in moderation in April, but we were navigating the lower tax return. So again, delivered the quarter but what we're observing is a much choppier environment for the way that the consumer is reacting to the news and how that's impacting the way they spend.

然後在 3 月份，我們肯定看到了與我認為你聽到的類似的疲軟，這主要是由於區域銀行的情況正在發揮作用，以及消費者在 3 月份緊縮政策時所產生的影響，然後是4 月份略有溫和復蘇，但我們正在應對較低的納稅申報表。因此，再次交付了本季度，但我們觀察到的是消費者對新聞的反應方式以及這如何影響他們的消費方式的動盪環境。

As it relates to Q2 then, we have seen a little bit of that softness continue into May. But what I would say is that that's considered in the outlook we just provided. And the reason why we gave a range for Q2 is that we're trying to provide for whatever scenarios could potentially play out with some of the choppiness that we're seeing out there and if there are situations where the consumer contracts. So hopefully, that's helpful, but that's how we're thinking about it.

就當時的第二季度而言，我們已經看到這種疲軟一直持續到 5 月。但我要說的是，我們剛剛提供的展望中已經考慮到了這一點。我們為第二季度給出一個範圍的原因是，我們試圖提供任何可能會出現的情況，我們在那裡看到的一些動盪，以及是否存在消費者合同的情況。希望這會有所幫助，但這就是我們考慮的方式。

Your next question comes from the line of Matthew Boss from JPMorgan.

你的下一個問題來自摩根大通的 Matthew Boss。

Great. So Bob, you cited market share gains at the Old Navy brand. Maybe could you just expand on trends that you're seeing in that business and how you feel regarding the balance today in your assortments maybe relative to what you see driving the softer Athleta performance?

偉大的。所以鮑勃，你提到了老海軍品牌的市場份額增長。也許你可以擴展你在該業務中看到的趨勢，以及你對今天在你的分類中的平衡的看法可能與你看到的推動 Athleta 表現更柔和的因素有關？

Yes, I mean, we're certainly pleased to see the momentum carry in to drive the market share gains. And as you heard us point to a little bit in our last conversations, women's, in particular, were really strong. We cited some examples like pocket dresses and so forth, and that really has spilled over into several other categories. But as I think you were sort of referencing, it's really where our mind is as well. We still see the brand over-assorted from where we wanted to be. And again, that's just part of this transition that we're working through. But we've continued to see good gains in and around categories that we'll know or we believe that we'll continue to see greater strength in.

是的，我的意思是，我們當然很高興看到勢頭繼續推動市場份額的增長。正如您在上次談話中聽到我們指出的那樣，女性尤其強大。我們舉了一些例子，比如袖珍連衣裙等等，這些例子實際上已經擴展到了其他幾個類別。但正如我認為你在某種程度上提到的那樣，這也是我們的想法所在。我們仍然看到品牌從我們想要的地方過度分類。再一次，這只是我們正在努力完成的過渡的一部分。但我們繼續看到我們知道的類別及其周圍的良好收益，或者我們相信我們將繼續看到更大的優勢。

The brand itself is in a period right now again of making a lot of those adjustments coming out of cleaning up its inventory, getting rid of the pack and hold and so forth. And I think the kind of performance that we'll see going forward will add a little bit more clarity around the categories in particular that we believe the brand will really thrive on long term. But right now, I'm happy with the progress and again, to see the kind of gains help us with some momentum.

該品牌本身現在正處於進行大量調整的時期，這些調整來自清理庫存、擺脫打包等。而且我認為我們將看到的那種表現將使類別更加清晰，特別是我們相信該品牌將真正長期蓬勃發展的類別。但現在，我對取得的進展感到高興，並且再次看到這種收穫幫助我們獲得了一些動力。

Look, on Athleta, it's just really clear that we walked away a little bit too far from our performance DNA. Definitely had some misses in and around product specifics, silhouettes, color and even just some of the styling, et cetera. And that really, again, gave us a big challenge relative to that customer, what she's coming in for. Although our bottoms continue to be really strong, we have to be able to capitalize on a lot more than that. And everything that, that brand stands for, for that customer, we're not backing down from at all. The Power of She, the emotion in the brand, performance, why we are moving aggressively to get in more aggressively in like running, yoga, some of those areas that we know have been real big misses for us.

看，在 Athleta 上，很明顯我們離我們的性能 DNA 有點太遠了。在產品細節、輪廓、顏色，甚至只是一些造型等方面，肯定有一些遺漏。這真的再次給我們帶來了與該客戶相關的巨大挑戰，即她的到來。儘管我們的底部仍然非常強勁，但我們必須能夠利用比這更多的東西。對於那個品牌所代表的一切，對於那個客戶，我們根本不會退縮。她的力量，品牌中的情感，表現，為什麼我們要積極進取，更積極地進入跑步、瑜伽等領域，我們知道其中一些領域對我們來說是真正的大失誤。

It's what that team right now is really focused on. And as we commented in our remarks, I'm really pleased right now how the current team is making the most, if you will, out of everything we have that the customer is really resonating with. And we look forward to seeing that brand find its stride again, no pun intended. But we know -- you know how important that brand is to the company, and we're optimistic that we're going to get back where we need to be.

這就是該團隊現在真正關注的重點。正如我們在評論中所評論的那樣，我現在真的很高興目前的團隊如何從我們擁有的一切中獲得最大收益，如果你願意的話，客戶真正會產生共鳴。我們期待看到該品牌再次大步向前，這不是雙關語。但我們知道 - 你知道這個品牌對公司有多重要，我們樂觀地認為我們將回到我們需要的地方。

Your next question comes from the line of Brooke Roach from Goldman Sachs.

你的下一個問題來自高盛的布魯克羅奇。

Can you talk to the composition of your inventory today and your current ability to chase into products that are resonating with the consumer, how much chaseability do you have? And do you think that could potentially improve your performance into the back half of the year? And then similarly, Katrina, can you provide some updated comments on your outlook for free cash flow?

你能談談你今天的庫存構成和你目前追逐與消費者產生共鳴的產品的能力，你有多少追逐能力？你認為這有可能提高你下半年的表現嗎？然後類似地，卡特里娜，你能提供一些關於你的自由現金流前景的最新評論嗎？

You go ahead and take the chase part, and I'll add to it.

你繼續去追逐部分，我會添加它。

Sure. I mean I think, Brooke, we're really pleased with the fact that we were able get our inventories down to where they are not only on a 1-year basis, but really back to 2019, being much more in line with what we consider to be healthy inventory levels. And I think you saw that show up in the gross margin performance for the quarter where we were able to still offer a lot of value to the consumer, but we didn't have all the markdown cleanup from last year that we had to deal with, and so we were able to really clean up that overall margin. So we feel good about that piece.

當然。我的意思是，我認為，Brooke，我們真的很高興我們能夠將我們的庫存降低到不僅是 1 年的水平，而且真的回到了 2019 年，這與我們的目標更加一致認為是健康的庫存水平。而且我認為您看到了本季度的毛利率表現，我們仍然能夠為消費者提供很多價值，但我們沒有去年必須處理的所有降價清理工作，因此我們能夠真正清理總利潤。所以我們對那件作品感覺很好。

As it relates to chase, I think we've talked about this. We are now back to being able to reinstate our responsive capabilities. And a lot of the organizational structural changes that we made in the business will also help us really have better line of sight to end-to-end inventory management and allows us to get back to really chasing into trends that are working. I think what's different is that Old Navy is back to pre-pandemic levels of chase, if not, slightly better. But now we have the capabilities across our brands, which is really nice to see. And so all of our brands should be able to be chasing inventory much closer to the consumer. I don't know if you wanted to add anything, Bobby?

由於它與大通有關，我想我們已經討論過了。我們現在可以恢復我們的響應能力。我們在業務中所做的許多組織結構變化也將幫助我們更好地了解端到端庫存管理，並讓我們重新真正追逐有效的趨勢。我認為不同之處在於 Old Navy 恢復到大流行前的追逐水平，如果不是，稍微好一點。但現在我們擁有跨品牌的能力，這真的很高興看到。因此，我們所有的品牌都應該能夠在更接近消費者的地方追逐庫存。我不知道你是否想補充什麼，Bobby？

No, I think you covered it well. I think, Brooke, the one thing that I would just highlight again from my seat is, look, I mean, supply chain capabilities is something that we've really long had as a core strength, and I would say that a few things got away from us a bit. We're back really capitalizing now on our vendors who work with us very strong collaboratively, helping us with consumer insights, engaging, if you will, with innovation and all of that, that moves through the pipeline.

不，我認為你涵蓋得很好。我想，Brooke，我想在我的座位上再次強調的一件事是，看，我的意思是，供應鏈能力是我們長期以來一直擁有的核心力量，我想說有幾件事得到了離我們遠一點。我們現在又回來真正利用我們的供應商，他們與我們合作非常緊密，幫助我們了解消費者，參與，如果你願意的話，通過創新和所有這些，通過管道移動。

So to your question about our expectations around the back half, I would say the answer is, yes, I mean, we believe that we're finding ourselves back where we've got great leverage points. We're seeing good success as we chase back in the product and again, really getting back to that discipline and rigor in a very effective way. So I'm actually proud of that progress, really quite proud.

因此，對於你關於我們對後半部分的期望的問題，我會說答案是，是的，我的意思是，我們相信我們正在發現自己回到了我們擁有巨大槓桿點的地方。當我們一次又一次地追回產品時，我們看到了很好的成功，真正以一種非常有效的方式回到了那種紀律和嚴謹。所以我實際上為這一進步感到自豪，真的很自豪。

And then, Brooke, as you asked, obviously, our discipline around inventory and expenses combined with better operating performance is giving us more confidence in our free cash flow outlook. I think you heard on the call that free cash flow was down $102 million in the quarter, which is very in line with our seasonality and back to a much more normalized level. In fact, that's a lower level of outflow than we normally see in Q1 based on the fact that we have such tight inventory and expenses. And certainly, our aspiration is to get back to generating free cash flow in the company through better operating performance. So more to come as we see where the year comes out.

然後，布魯克，正如你所問，顯然，我們在庫存和費用方面的紀律以及更好的經營業績使我們對自由現金流前景更有信心。我想你在電話會議上聽說本季度自由現金流下降了 1.02 億美元，這與我們的季節性非常一致，回到了更加正常的水平。事實上，這比我們在第一季度通常看到的流出水平要低，因為我們的庫存和支出如此緊張。當然，我們的願望是通過更好的經營業績重新為公司創造自由現金流。隨著我們看到這一年的結果，還會有更多。

Your next question comes from the line of Lorraine Hutchinson from Bank of America Global Research.

你的下一個問題來自美國銀行全球研究部的 Lorraine Hutchinson。

I'm curious to hear more about the reduction in promotions at Old Navy. Can you talk about where margins are versus pre-COVID levels for that brand and also what the reaction has been to some of your recent price increases?

我很想知道更多關於 Old Navy 晉升減少的消息。您能否談談該品牌的利潤率與 COVID 之前的水平相比，以及對您最近的一些價格上漲的反應是什麼？

Yes, Lorraine, thanks for your question. Interestingly, when we look at the composition of the margin benefit that we got in the quarter across all of our banners, again, the reduction in inventory has really allowed us to clean up the markdown piece of the business, which doesn't add a lot of customer value, right? That's just inventory that last year wasn't responded too well by the consumer, and we had to sell through given excess inventory, the wrong inventory.

是的，洛林，謝謝你的提問。有趣的是，當我們查看本季度所有橫幅廣告的利潤構成時，庫存的減少確實讓我們清理了業務的降價部分，這並沒有增加很多客戶價值，對吧？那隻是去年消費者反應不太好的庫存，我們不得不通過給定的過剩庫存和錯誤的庫存來銷售。

So the margin benefits coming from cleaning up that markdown, what that's allowing us to do is still promote, which is a better way to be offering value to the consumer, which is still important at this time. And that's true at Old Navy. As it relates to price increases, I would say, overall, we are not seeing a lot of adverse reaction to price increases. The team was very surgical around taking up prices on categories or items that are known to be important in a consumer's wardrobe right now, like wovens or pants, or our outstanding fashion items that just are so wow that the customer has to have it. So I would say, as we look back, we feel very good about where the teams have priced up. And the promotions have remained rather competitive. As far as versus pre-pandemic, we're still better off than pre-pandemic.

因此，清理降價帶來的利潤收益，讓我們仍然可以做的是促銷，這是向消費者提供價值的更好方式，這在目前仍然很重要。 Old Navy 也是如此。由於它與價格上漲有關，我想說，總的來說，我們沒有看到對價格上漲有很多不利反應。該團隊非常謹慎地對目前已知在消費者衣櫥中很重要的類別或商品定價，例如編織物或褲子，或者我們出色的時尚商品，這些商品是如此令人驚嘆以至於客戶必須擁有它。所以我想說，當我們回顧過去時，我們對球隊定價的地方感到非常滿意。而且促銷活動仍然相當有競爭力。就大流行前而言，我們仍然比大流行前要好。

Your next question comes from the line of Jonna Kim from Cowen & Company.

你的下一個問題來自 Cowen & Company 的 Jonna Kim。

This is [Neil Go] filling in for Jonna today. Just kind of touching on this from your point earlier. Can you just give some more color on how that promotional environment has been, perhaps different income cohorts and demographics since that was one of the brighter spots? And then what are you assuming from a timing perspective for the rest of the year as we eventually enter the back-to-school period?

今天我是 [Neil Go] 代替 Jonna。只是從你之前的觀點談起這一點。您能否就促銷環境的情況提供更多顏色，也許是不同的收入人群和人口統計數據，因為這是亮點之一？然後，當我們最終進入返校期時，從時間的角度來看，您對今年餘下時間的假設是什麼？

Yes, [Neil], so I think what's interesting on our income cohort is that it continues to be similar to what we've seen in the back half into Q1, which is when you look at markets where we have a demographic of a low-income consumer, we are certainly seeing those consumers contract their spending and being much more price sensitive. In areas where we have the higher-income consumer, there's a lot less price sensitivity and they are still spending. So that dynamic has continued, and as of now, we'll see how that plays forward.

是的，[Neil]，所以我認為我們的收入隊列中有趣的是，它仍然與我們在第一季度後半段看到的情況相似，即當您查看我們人口較少的市場時- 收入消費者，我們當然看到這些消費者收縮他們的支出並且對價格更加敏感。在我們擁有高收入消費者的地區，對價格的敏感度要低得多，而且他們仍在消費。所以這種動力一直在持續，截至目前，我們將看到它如何發揮作用。

But that's part of the reason why we have ranges of outcomes around our revenue performance, is because we don't know what will happen as we head into the back half of the year and decide whether we will need to compete more or less. I think, so far, what we've seen, and maybe you've heard this more in the industry, is that, as we just talked about, we've had to do less promotion to clear inventory because our inventories are so much more in line. And really, our promotions have been more focused on adding value to the consumer, which we hope will be more revenue driving actions and less about clearing inventory.

但這就是我們在收入表現方面有一系列結果的部分原因，因為我們不知道進入下半年會發生什麼，並決定我們是否需要更多或更少的競爭。我想，到目前為止，我們所看到的，也許你在業內聽到的更多，是，正如我們剛才所說的，我們不得不減少促銷來清理庫存，因為我們的庫存太多了更符合。事實上，我們的促銷活動更側重於為消費者增加價值，我們希望這將是更多的收入驅動行動，而不是清理庫存。

Your next question comes from the line of Corey Tarlowe from Jefferies.

您的下一個問題來自 Jefferies 的 Corey Tarlowe。

First, I'm wondering, Katrina, if you could just assess for us the health of the Gap store fleet. I think over the last 2 years, you've closed something like 370 stores. The segment actually comped positively this past quarter, so it would be helpful to just get some color there.

首先，我想知道，卡特里娜颶風，你是否可以為我們評估一下 Gap 門店的健康狀況。我想在過去的兩年裡，你關閉了大約 370 家商店。該細分市場在上個季度實際上取得了積極的進展，因此在那裡獲得一些顏色會有所幫助。

And then just on the Old Navy improvement that you're witnessing, recognizing that there's still more work to do. Maybe could you talk a little bit about what that work is and how far along or maybe what inning you think we're in, in terms of the Old Navy improvement?

然後就您所目睹的 Old Navy 改進而言，認識到還有更多工作要做。就 Old Navy 的改進而言，也許你能談談這項工作是什麼，以及你認為我們處於什麼階段？

Yes, Corey, as you say, the store fleet, we've worked aggressively on over the last 3 years during the COVID pandemic. And so as you say, overall, we have closed or will have closed by the end of this year about 350 Gap and Banana stores, so both of our specialty fleets, we've been working on. And do I think we're done? I don't know, but we are largely through the lion's share of the restructuring activity that had to be done. And I think as you say, that is showing up in the fact that the balance of the fleet that's remaining is relatively healthy. Now we need to continue to work on keeping that fleet healthy, but fundamentally right now, I think we feel pretty good with where we've positioned both our Gap and Banana Republic fleets.

是的，科里，正如你所說，在過去 3 年的 COVID 大流行期間，我們一直在積極開展工作。正如你所說，總的來說，我們已經關閉或將在今年年底關閉大約 350 家 Gap 和 Banana 商店，所以我們的兩個專業車隊，我們一直在努力。我認為我們完成了嗎？我不知道，但我們主要是通過必須完成的大部分重組活動完成的。我認為正如你所說，事實表明，剩餘機隊的平衡相對健康。現在我們需要繼續努力保持車隊的健康，但從根本上說，我認為我們對 Gap 和 Banana Republic 車隊的定位感到非常滿意。

As it relates to Old Navy, I think you've heard us call out that we feel really good about the fact that we gained share in women's. I think we would say that we would like to keep seeing more momentum in men's and kids. And then within some of the categories, I think, active as an example, where we've gained a lot of share over a multiyear period, but we're seeing a little bit of reversion there, and there's probably some more work to do to get that assortment back to being current. But I don't know, Bobby, if you want to comment more on the Old Navy [piece].

關於 Old Navy，我想你已經聽到我們大聲疾呼，我們對我們在女性市場中獲得份額這一事實感到非常高興。我想我們會說我們希望繼續看到男裝和童裝的發展勢頭。然後在一些類別中，我認為，以活躍為例，我們在多年的時間裡獲得了很多份額，但我們在那裡看到了一些回歸，可能還有更多工作要做使該分類恢復到最新狀態。但我不知道，Bobby，你是否想對 Old Navy [作品] 發表更多評論。

No. I mean, again, I think we're kind of indicating, again, we're seeing it travel along the journey here, again, getting the assortment, really rationalize and balance the right way. And look, you guys realize this as well as we do. This is across all brands. But I mean we design into the coolness, to the brand relevance, the creative, being right on fashion and getting inventory under control always.

不，我的意思是，我認為我們再次表明，我們再次看到它在這裡的旅程中再次獲得分類，真正合理化和平衡正確的方式。看，你們和我們一樣意識到這一點。這適用於所有品牌。但我的意思是，我們的設計融入了酷感、品牌相關性、創意、時尚和始終控制庫存。

When we do that, we're always going to do a better job in driving brand relevance, maximizing marketing effectiveness. That certainly is true around the right promotional approach and balance for Old Navy and in turn, I think, continue to allow it to produce the kind of margin that we want to see and structure to run with and compete with and get back again to really the essence of that brand. That brand has always been known for fun, if you will, and the brand itself is -- or the team is working around what future of fun looks like around that brand and how it differentiates itself in the marketplace.

當我們這樣做時，我們總是會在推動品牌相關性、最大化營銷效果方面做得更好。圍繞 Old Navy 的正確促銷方法和平衡，這當然是正確的，反過來，我認為，繼續讓它產生我們希望看到的那種利潤和結構，以與之競爭並再次回歸真正該品牌的精髓。如果你願意的話，這個品牌一直以樂趣而聞名，品牌本身就是——或者團隊正在研究圍繞該品牌的樂趣的未來，以及它如何在市場上脫穎而出。

Staying close to the customer, you guys touched on it, and I'll just acknowledge it back. That's a value proposition that we know we compete in very aggressively. I like the work that the team is doing, the rigor they're putting in around the right diagnostics at every level from -- whether it's online or in-store, this merchandising structure change, where we're moving ahead of commerce. So we're bringing together both the online and the in-store together around experience, and everything we're doing from a product and service is all a part of these improvements that, again, we're counting on and Old Navy, in particular, probably one of the bigger beneficiaries as we land all that work.

貼近客戶，你們觸及了它，我只會回應。這是一個價值主張，我們知道我們非常積極地參與競爭。我喜歡團隊正在做的工作，他們在每個層面上都圍繞著正確的診斷進行了嚴謹——無論是在線還是店內，這種銷售結構的變化，我們正在領先於商業。因此，我們將在線和店內體驗結合在一起，我們從產品和服務中所做的一切都是這些改進的一部分，我們再次指望這些改進，而 Old Navy，在特別是，當我們完成所有這些工作時，它可能是更大的受益者之一。

Your next question comes from the line of Mark Altschwager from Baird.

您的下一個問題來自 Baird 的 Mark Altschwager。

I wanted to follow up on the promo topic as well and gross margin. It seems like the promo recapture was really the key driver to the upside to expectations in Q1, at least relative to our model and I think how many were looking at Q1 gross margin. Is that magnitude of recapture a good run rate to think about as we move through the next few quarters? And just given your comment about promo shifting more to being used to engage the customers versus clearing inventory, if we were to see some moderation in that Q1 result, I mean, would it be fair to think that we could maybe see some incremental top line benefit as we move through the year?

我也想跟進促銷主題和毛利率。似乎促銷的重新奪回確實是第一季度預期上行的關鍵驅動因素，至少相對於我們的模型而言，我認為有多少人關注第一季度的毛利率。在接下來的幾個季度中，這種重新奪回的規模是否是一個值得考慮的良好運行率？鑑於您關於促銷更多地用於吸引客戶而不是清理庫存的評論，如果我們在第一季度的結果中看到一些緩和，我的意思是，我們是否可以公平地認為我們可能會看到一些增量收入在我們度過這一年時受益？

Yes, Mark, it's such a good question and one I'm really glad you asked. So the upside in Q1, as you say, we saw modest upside from freight, which we talked about, but really, the bigger upside, I think, came from less discounting. I would not use the 380 basis points of benefit from discounting as a run rate. We just said that, in Q2, about 200 -- at least 200 basis points of inflationary pressure will get offset in discount, so that already nods to a moderation.

是的，馬克，這是一個很好的問題，我很高興你提出這個問題。所以第一季度的好處，正如你所說，我們看到我們談到的運費帶來適度的好處，但實際上，我認為更大的好處來自折扣的減少。我不會使用貼現帶來的 380 個基點收益作為運行率。我們剛剛說過，在第二季度，大約 200 - 至少 200 個基點的通脹壓力將被貼現抵消，所以這已經表明了溫和。

And then for the full year, we said at least 100 basis points in that discount. And you could ask why wouldn't we see more. I think right now what we're saying is that's the way we'd say maybe a floor of what we think that's worth. We'll see how hard we have to play in Q2 and beyond depending on where the consumer goes and whether that shows up in revenue or whether that shows up just in us having to play harder to be able to compete as we move through the year.

然後對於全年，我們說該折扣至少有 100 個基點。你可能會問為什麼我們看不到更多。我認為現在我們所說的就是我們所說的方式，也許是我們認為值得的地板。我們將看到我們在第二季度及以後必須付出多大的努力，這取決於消費者的去向以及這是否體現在收入中，或者這是否僅僅體現在我們必須更加努力才能在這一年中競爭.

So I'm glad you asked the question. Those do moderate as we get through the year. And again, depending on where the customer lands, we'll see whether there's upside there or not.

所以我很高興你問了這個問題。隨著我們度過這一年，這些確實溫和。再一次，根據客戶登陸的位置，我們將看看那裡是否有優勢。

Your next question comes from the line of Paul Kearney from Barclays.

你的下一個問題來自巴克萊銀行的 Paul Kearney。

Can you talk more about some of the efforts to reduce costs and simplify? How will the changes you've made improve responsiveness throughout the organization? And are there additional levers to drive sustainable savings as you rebase this year?

能否多談談在降低成本和簡化方面所做的一些努力？您所做的更改將如何提高整個組織的響應能力？在您今年調整基準時，是否還有其他槓桿來推動可持續儲蓄？

Paul, it's Bobby. I'll start and see if Katrina wants to add on to it. But look, I think it almost goes without saying, getting rid of layers from 12 to 8, the effect on span of control, it's really clear that where we found ourselves was really slowing down and impacting our ability to be quick on decision-making as well as certainly identifying where we've had productivity misses and the like. So that work, I don't think should be understated. It's difficult work that's gone on. But we found ourselves with an SG&A, obviously, that was untenable, not one that we would look to continue to try and compete with. So pulling out the cost is relevant and it's meaningful, but again, I'd just go back and point to the big payback and unlock here is, again, as I made in my -- I mentioned in my comments, the big payback is when we're going to start showing up more informed, more in tune with the customer being driven by consumer insights, more responsive and the like.

保羅，是鮑比。我會開始看看 Katrina 是否想添加它。但是看，我認為這幾乎是不言而喻的，從 12 層到 8 層，對控制跨度的影響，很明顯我們發現自己真正放慢速度並影響我們快速決策的能力以及肯定地確定我們在哪裡有生產力失誤等。因此，我認為不應低估這項工作。這是一項艱鉅的工作。但我們發現自己有一個 SG&A，顯然，這是站不住腳的，我們不會繼續嘗試與之競爭。因此，降低成本是相關的，它是有意義的，但是我再次回到並指出巨大的回報並解鎖這裡是，再次，正如我在我的評論中提到的那樣，巨大的回報是當我們要開始展示更多信息，更符合消費者洞察力驅動的客戶時，響應速度更快等。

So we're not doing anything here other than I hope what you caught is we're in pursuit of a mindset change and a cultural shift that keeps us in this mode all the time of continuous improvement and looking at how we continue to not just cut the cost but again, get ourselves where we're far more responsible -- or responsive, agile and again, a lot more competitive.

所以我們在這裡什麼也沒做，除了我希望你發現的是我們正在追求一種思維方式的轉變和一種文化轉變，使我們一直處於這種模式，不斷改進，並審視我們如何繼續，而不僅僅是降低成本，但再次讓我們自己變得更加負責任 - 或者響應迅速，敏捷，再次更具競爭力。

Just one more time, I'd say difficult work in the short time that I have been here, although didn't feel all that short. I'm really pleased with, again, the way the team has embraced this change. Any of us that have watched this level of change happen, we know it takes a lot. And right now, I think our quarter results indicate some good -- show some good indication of where we have reason to be pleased with part of it, but we have a lot farther to go and a lot more work to do.

再說一次，我會說在我來這裡的短時間內完成了艱鉅的工作，儘管我並不覺得那麼短。我再次對團隊接受這一變化的方式感到非常高興。任何目睹這種程度的變化發生的人都知道這需要付出很多。現在，我認為我們的季度業績表明了一些好的跡象——表明我們有理由對其中的一部分感到滿意，但我們還有很長的路要走，還有很多工作要做。

And Paul, I think to add on what I would say is regarding further savings, right now, we're really pleased with the cost savings that are coming from these organizational changes as well as some early savings we got last year in marketing through some contract negotiations and a little bit of tech. But marketing and technology, I think, are the 2 areas that we've identified we have further opportunity in. And now that we have our organizational structures in place and those teams get settled, we'll begin the work to really understand what the next opportunity will look like. So more to come when we get through the organizational change and are able to sort of move our focus to those next items of opportunity.

保羅，我想補充一下我要說的關於進一步節省的內容，現在，我們對這些組織變革帶來的成本節省以及我們去年通過一些營銷活動獲得的早期節省感到非常滿意合同談判和一點技術。但我認為，市場營銷和技術是我們已經確定的兩個領域，我們有更多的機會。現在我們的組織結構已經到位，這些團隊已經安頓下來，我們將開始工作以真正了解下次機會會是什麼樣子。因此，當我們完成組織變革並能夠將我們的注意力轉移到下一個機會項目時，還會有更多的事情發生。

Your next question comes from the line of Janet Kloppenburg from JJK Research.

您的下一個問題來自 JJK Research 的 Janet Kloppenburg。

Congratulations on the improvement. Nice to see. Katrina, on the promotion and less recapture, that assumption for the second quarter, is that a trend that you're seeing right now? And do you feel, even with your inventories down as much as they are, that you've had to step up promotions?

祝賀你的進步。很高興見到。卡特里娜颶風，關於第二季度的晉升和減少奪回的假設，這是你現在看到的趨勢嗎？你是否覺得，即使你的庫存減少了這麼多，你是否不得不加大促銷力度？

And I also wondered, in your guidance for the second quarter and for the year, what the assumption is on kids and men's. Do you expect those categories to improve? Or do you expect that pressure to be maintained as we move through the year?

我還想知道，在您對第二季度和今年的指導中，對兒童和男性的假設是什麼。您希望這些類別有所改善嗎？還是您希望在我們度過這一年時保持這種壓力？

And lastly, I wondered if there was any news on denim and how that might be affecting your back-to-school outlook. And one last question, sorry, is just on where we should expect inventories to trend going forward. Sorry.

最後，我想知道是否有任何關於牛仔布的新聞，以及這可能會如何影響您的返校前景。抱歉，最後一個問題是我們應該期望庫存在未來的趨勢。對不起。

No worries. So on the gross margin and promotional trend, I mean, I'm not really going to comment. It's very early in the quarter, so we'll see. We've given you a sense for the year -- I mean, for the quarter and the year where we think those things will land. And so we'll see how it goes. Memorial Day is coming up. That's usually a big kickoff to summer, and so we'll see how that all goes.

不用擔心。所以關於毛利率和促銷趨勢，我的意思是，我真的不會發表評論。現在是本季度的早期，所以我們拭目以待。我們已經讓您了解了這一年——我的意思是，對於我們認為這些東西將會落地的季度和年份。因此，我們將看看進展如何。陣亡將士紀念日快到了。這通常是夏季的重要開場，因此我們將拭目以待。

On the kids and men's thing, kids, in general, the marketplace has been down. So while our kids business has been modestly under pressure, we've been gaining share at Old Navy. And so we'll see how that goes. But there's sort of a range of possible outcomes for both kids and men's as we look to the second quarter and the second half, all of which are contemplated in the guidance we gave.

在童裝和男裝方面，總體而言，童裝市場一直處於低迷狀態。因此，儘管我們的童裝業務略有壓力，但我們在 Old Navy 的市場份額一直在增加。因此，我們將看看情況如何。但是，當我們展望第二季度和下半年時，兒童和男子都有一系列可能的結果，所有這些都在我們給出的指導中進行了考慮。

And then on the denim front, we've been gaining share in denim all year, and we gained share again in Q1, so we're relatively pleased with what the teams have been doing around denim. And I guess we'll see how that plays out in back to school, but at least we've got some good momentum heading into back to school in that category. There was a fourth one I can't remember. What was it?

然後在牛仔布方面，我們全年都在增加牛仔布的份額，我們在第一季度再次獲得份額，所以我們對團隊圍繞牛仔布所做的工作相對滿意。而且我想我們會看到它在返校後的表現如何，但至少我們在該類別中有一些良好的勢頭進入返校。還有第四個我不記得了。它以前如何？

Inventory, Katrina, inventory.

庫存，卡特里娜颶風，庫存。

Inventories. Yes, so we said in my -- or I said in my speech that we do expect for inventories to be down meaningfully more than the sales guide. So we'll see, but we did end up down 27%, and that will be our goal, is to keep those inventories well under control.

庫存。是的，所以我們在我的演講中說過——或者我在演講中說過，我們確實預計庫存會比銷售指南大幅下降。所以我們會看到，但我們最終確實下降了 27%，這將是我們的目標，就是將這些庫存控制在良好的範圍內。

(Operator Instructions) Your last question will come from Marni Shapiro from The Retail Tracker.

（操作員說明）您的最後一個問題將來自 The Retail Tracker 的 Marni Shapiro。

Congratulations on some really nice improvements in the stores. I just wanted to focus a little bit on Athleta again because I know this is a growth vehicle for you and important as you're searching for leadership there. Could you give us an estimated time line of when you think the changes with color, print and the better balance start to really show up? Will it be there for back to school and the fall season and for winter gifting?

祝賀商店有了一些非常好的改進。我只是想再次關註一下 Athleta，因為我知道這對你來說是一種成長的工具，而且當你在那裡尋找領導力時很重要。你能給我們一個你認為顏色、印刷和更好的平衡的變化何時開始真正顯現的估計時間嗎？它會在返校、秋季和冬季禮物時出現嗎？

And then if we could also just think forward, do you need new leadership in place to start innovating? Because even this is a part of the market that's heavy on innovation, the performance part of the market, and while I like a lot of the styles you have, some of them have become a little stale, while other brands are advancing in this moment. So I'm just curious if you could talk about those 2 parts of the business.

然後，如果我們也可以向前看，您是否需要新的領導層來開始創新？因為即使這是市場的一部分，也很重視創新，市場的性能部分，雖然我喜歡你的很多款式，但其中一些已經變得有點陳舊，而其他品牌在這一刻正在進步.所以我很好奇你是否可以談談業務的這兩個部分。

Do you want me to start?

你想讓我開始嗎？

Sure.

當然。

First of all, thanks for being so kind, Marni. I would say that -- to answer to your question kind of from the bottom back. Do we need to have new leadership to really start seeing the innovation? I would not take anything away from current team. Again, our focus has really, I think, enabled a lot of moves and changes there. We've already seen wonderful contributions from Julia Leach who we added as kind of fresh perspective on the creative side.

首先，謝謝你這麼好心，Marni。我會這麼說——從底部回答你的問題。我們是否需要有新的領導才能真正開始看到創新？我不會從目前的團隊中拿走任何東西。同樣，我認為，我們的重點確實促成了那裡的許多行動和變化。我們已經看到了 Julia Leach 的精彩貢獻，我們添加了她作為創意方面的新視角。

You do understand obviously quite well because of the question that fabrications and other things really are a little bit longer pipe for this brand. That said, the brand is taking every opportunity we can, where if it was an opportunity for raw material to be adjusted a bit to land something for fall, perhaps holiday, there are opportunities being engineered into that. But to go much farther than that, I think that would be too aggressive.

你確實很清楚，因為製造和其他東西對於這個品牌來說真的有點長。也就是說，該品牌正在抓住一切可能的機會，如果這是一個機會，可以對原材料進行一些調整，以便為秋季或假期提供一些東西，那麼就有機會被設計成這樣。但要走得更遠，我認為那太激進了。

At the same time, [this seems] amazing me right now, everything that they're doing to come up to maximize opportunity. What's most important obviously here is, again, we know what this brand stands for. We know what she looks for every time she comes in. You just highlighted it again. And it'll take us a while to get back where we need to be, but hopefully, we will exceed your expectations and mine.

與此同時，[這似乎]讓我感到驚訝，他們正在做的一切都是為了最大化機會。顯然，這裡最重要的是，我們知道這個品牌代表什麼。我們知道她每次進來都在尋找什麼。你剛剛再次強調了它。我們需要一段時間才能回到我們需要的地方，但希望我們能超越你和我的期望。

I hope so. Can I just ask one follow-up? You've been promotional, obviously, to clear out the inventory, and it's going to take some time to fix this. Even within the store today, are there things that she's buying that don't need a promotion? And is there a risk that she gets used to 20% off, 30% off, 40% off there? So how careful do you have to be over the next couple of months in dealing with this?

但願如此。我可以只問一個後續嗎？顯然，您一直在促銷以清理庫存，並且需要一些時間來解決這個問題。即使在今天的商店裡，她買的東西有沒有不需要促銷的？她是否有習慣 20% 折扣、30% 折扣、40% 折扣的風險？那麼在接下來的幾個月裡，你要多小心處理這個問題呢？

Go ahead, Katrina.

去吧，卡特里娜。

Yes, Marni, I mean I think that's a great question. We certainly see that there are core performance bottoms and there are fashion styles that don't need a promotion, and the team is being very cognizant on trying not to train her for promotion by utilizing markdowns better to be more targeted. And there -- but there is a reality of sort of where we are today and where we need to go. The ultimate goal will be to get that brand back to not relying on promotions to be able to drive the business but drive the business through its fashion authority and its innovation and its positioning. And that is what the team is working towards long term. So it's a great question and one that the team is definitely focused on.

是的，Marni，我的意思是我認為這是一個很好的問題。我們當然看到有核心性能底部和不需要促銷的時尚風格，並且團隊非常清楚地嘗試通過更好地利用降價來更有針對性地訓練她進行促銷。在那裡 - 但是我們今天所處的位置和我們需要去的地方存在某種現實。最終目標將是讓該品牌回到不依靠促銷來推動業務，而是通過其時尚權威、創新和定位來推動業務的狀態。這就是團隊長期努力的方向。所以這是一個很好的問題，也是團隊絕對關注的問題。

That does conclude our conference call. You may now disconnect.

這確實結束了我們的電話會議。您現在可以斷開連接。