Gap and American Eagle Shares Slide on Weak Earnings, Retailers Blame Internal Issues Not Consumer Spending

Shares of Gap Inc. and American Eagle Outfitters fell on Thursday after both retailers reported quarterly earnings that fell short of analyst expectations. Despite the underwhelming results, executives at both companies said they see no signs of broader economic weakness, attributing their performance to internal operational challenges rather than a pullback in consumer spending.

Earnings Misses Drive Stock Declines

Gap reported first-quarter earnings that missed consensus estimates, sending its shares down more than 6% in morning trading. The company cited inventory management issues and higher markdowns as key drags on profitability. American Eagle Outfitters also posted weaker-than-expected results, with its stock dropping over 5%. The retailer pointed to supply chain disruptions and higher input costs as factors that hurt margins, while reiterating that demand from shoppers remains robust.

Executives Dismiss Recession Fears

In post-earnings calls, Gap’s chief executive said the company’s problems are “self-inflicted” and not indicative of a softening economy. American Eagle’s management similarly stressed that consumer confidence is holding up, and that recent sales trends do not suggest a downturn. Both companies reaffirmed their full-year revenue forecasts, signaling confidence in the broader retail environment.

Market Context

On May 29, 2026, key market benchmarks were mixed. The U.S. dollar traded at 71.02 Russian rubles, down 0.35 points. The euro stood at 82.64 Russian rubles, declining 1.05 points. Bitcoin was priced at $73,344, down 0.5% over the past 24 hours. Crude oil remained near $72 per barrel, reflecting steady energy prices amid global demand concerns.