Cash conversion remains highly volatile, with the OCF/NI ratio swinging from -0.73 in 2025Q1 to 5.76 in 2025Q4, complicating the predictability of free cash flow.
| Metric | TTM | Jan'26 | Jan'25 | Jan'24 | Jan'23 | Jan'22 | Jan'21 | Jan'20 | Jan'19 | Jan'18 | Jan'17 | Jan'16 | Jan'15 | Jan'14 | Jan'13 | Jan'12 | Jan'11 | Jan'10 | Jan'09 | Jan'08 | Jan'07 | Jan'06 | Jan'05 | Jan'04 | Jan'03 | Jan'02 | Jan'01 | Jan'00 | Jan'99 | Jan'98 | Jan'97 |
|---|
| Cash from Operations | 1.95B | 1.29B | 1.49B | 1.53B | 607M | 809M | 237M | 1.41B | 1.38B | 1.38B | 1.72B | 1.59B | 2.13B | 1.71B | 1.94B | 1.36B | 1.74B | 1.93B | 1.93B | 2.08B | 1.25B | 1.55B | 1.6B | 2.17B | 1.24B | 1.32B | 1.29B | 1.48B | 1.39B | 844.7M | 835M |
| Operating CF Margin % | - | 8.41% | 9.85% | 10.29% | 3.89% | 4.85% | 1.72% | 8.61% | 8.33% | 8.7% | 11.08% | 10.09% | 12.95% | 10.56% | 12.37% | 9.37% | 11.89% | 13.58% | 13.27% | 13.2% | 7.84% | 9.68% | 9.82% | 13.69% | 8.57% | 9.52% | 9.44% | 12.7% | 15.4% | 12.98% | 15.8% |
| Operating CF Growth % | 296.4% | -12.99% | -3% | 152.39% | -24.97% | 241.35% | -83.2% | 2.17% | 0.07% | -19.72% | 7.84% | -25.13% | 24.87% | -11.93% | 42.04% | -21.85% | -9.54% | 0% | -7.35% | 66.48% | -19.41% | -2.88% | -26.44% | 75.31% | -6.03% | 2.06% | -12.63% | 6% | 65.05% | 1.16% | 70.72% |
| Net Income | 962M | 816M | 844M | 502M | -202M | 256M | -665M | 351M | 1B | 848M | 676M | 920M | 1.26B | 1.28B | 1.14B | 833M | 1.2B | 1.1B | 967M | 833M | 778M | 1.11B | 1.15B | 1.03B | 477.46M | -7.76M | 877.5M | 1.13B | 824.5M | 533.9M | 452.9M |
| Depreciation & Amortization | 628M | 496M | 500M | 522M | 540M | 504M | 507M | 557M | 517M | 499M | 531M | 527M | 500M | 470M | 483M | 506M | 562M | 573M | 655M | 547M | 530M | 625M | 620M | 664M | 780.88M | 810.49M | 590.37M | 436.2M | 326.4M | 269.7M | 214.9M |
| Stock-Based Compensation | 122M | 25M | 126M | 80M | 37M | 139M | 77M | 68M | 91M | 87M | 76M | 76M | 100M | 116M | 113M | 58M | 77M | 64M | 55M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 103M | 0 | 27M | -64M | 42M | -61M | -137M | -81M | 65M | 61M | -58M | 127M | 112M | 119M | -4M | -1M | 104M | -50M | -52M | -51M | -41M | -46M | -80M | 101M | 5M | -28.51M | -38.87M | 2.4M | -34.8M | -13.7M | -28.9M |
| Other Non-Cash Items | -529M | -25M | -4M | -8M | -7M | 438M | 627M | 206M | -53M | -13M | 111M | -165M | -158M | -182M | -99M | -25M | -42M | -72M | -70M | 107M | 67M | -28M | 57M | 79M | 161M | 58.44M | 130.88M | 211.8M | 80M | 23.7M | 47.4M |
| Working Capital Changes | 423M | -19M | -7M | 500M | 197M | -467M | -172M | 310M | -303M | -162M | 321M | 44M | 249M | -164M | 232M | -94M | -247M | 229M | 229M | 645M | -84M | -113M | -145M | 274M | -107M | 485.19M | -268.67M | -299.6M | 198.1M | 31.1M | 148.7M |
| Change in Receivables | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Inventory | 1M | -129M | -88M | 383M | 554M | -593M | -305M | 4M | -154M | -142M | 46M | -6M | -9M | -193M | -143M | 4M | -127M | 43M | 51M | 252M | -97M | 114M | -90M | 385M | -258.22M | 213.07M | -454.6M | -404.2M | -322.3M | -156.1M | -93.8M |
| Change in Payables | -31M | 57M | 137M | 42M | -540M | 186M | 564M | 66M | -78M | -90M | 146M | -47M | -41M | 105M | 91M | 11M | -7M | 40M | -4M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -839M | -600M | -692M | -334M | -227M | -446M | -510M | -894M | -1B | -666M | -529M | -730M | -596M | -624M | -844M | -454M | -429M | -537M | -398M | -274M | -150M | 286M | 183M | -2.32B | -629M | -950.63M | -1.87B | -1.28B | -826.4M | -313.9M | -435.9M |
| Capital Expenditures | -668M | -470M | -447M | -420M | -685M | -694M | -392M | -1.04B | -705M | -731M | -524M | -726M | -714M | -670M | -659M | -548M | -557M | -334M | -431M | -682M | -572M | -600M | -419M | -261M | -308M | -940.08M | -1.86B | -1.24B | -797.6M | -485.6M | -371.8M |
| CapEx % of Revenue | 4.34% | 3.06% | 2.96% | 2.82% | 4.39% | 4.16% | 2.84% | 6.38% | 4.25% | 4.61% | 3.38% | 4.6% | 4.34% | 4.15% | 4.21% | 3.77% | 3.8% | 2.35% | 2.97% | 4.33% | 3.59% | 3.74% | 2.58% | 1.65% | 2.13% | 6.79% | 13.59% | 10.65% | 8.81% | 7.46% | 7.04% |
| Acquisitions | 0 | 0 | 0 | 9M | 0 | -156M | 0 | -69M | 0 | 0 | 0 | 0 | 0 | 0 | -129M | 0 | 0 | 0 | -142M | 0 | 0 | 0 | 0 | 5M | 3.42M | -10.55M | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | 0 | 0 | 2M | 77M | 458M | -5M | 2M | 220M | -9M | 65M | -5M | -4M | 118M | -4M | -6M | -6M | 3M | 22M | 164M | 15M | 41M | 1.01B | 343M | -1.3B | -11.42M | 0 | -16.25M | -39.9M | -28.8M | -100K | -52.3M |
| Cash from Financing | -851M | -419M | -321M | -567M | 6M | -1.47B | 895M | -560M | -749M | -731M | -777M | -990M | -1.51B | -1B | -1.48B | -602M | -2.13B | -771M | -1B | -2.15B | -1.1B | -2.04B | -1.8B | -636M | 1.38B | 271.29M | 555.48M | -310.1M | -918.3M | -101.6M | -495.1M |
| Debt Issued (Net) | 0 | 0 | 0 | -350M | 350M | -1.05B | 943M | 0 | 0 | -67M | -421M | 379M | -21M | 144M | -419M | 1.66B | 3M | -50M | -50M | -326M | 0 | 0 | -871M | -668M | 1.3B | 209.34M | 871.42M | 396.6M | 1.4M | 540.4M | 18.4M |
| Equity Issued (Net) | -466M | -130M | -75M | 0 | -123M | -201M | 0 | -200M | -398M | -315M | 0 | -1.01B | -1.18B | -979M | -1.03B | -2.09B | -1.96B | -547M | -547M | -1.7B | -1.05B | -1.86B | -846M | 111M | 153M | 138.32M | -240.45M | -630.9M | -842.7M | -562.4M | -429.6M |
| Dividends Paid | -249M | -247M | -225M | -222M | -220M | -226M | 0 | -364M | -373M | -361M | -367M | -377M | -383M | -321M | -240M | -236M | -252M | -234M | -243M | -252M | -265M | -179M | -79M | -79M | -78M | -76.37M | -75.49M | -75.8M | -76.9M | -79.5M | -83.9M |
| Share Repurchases | -486M | -155M | -75M | 0 | -123M | -201M | 0 | -200M | -398M | -315M | 0 | -1.01B | -1.18B | -979M | -1.03B | -2.09B | -1.96B | -547M | -547M | -1.7B | -1.05B | -1.97B | -976M | 0 | 0 | -785K | -392.56M | -707.1M | -892.1M | -593.1M | -466.7M |
| Other Financing | -136M | -42M | -21M | 5M | -1M | 2M | -48M | 4M | 22M | 12M | 11M | 23M | 76M | 152M | 208M | 64M | 81M | 60M | 60M | 132M | 213M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -100K | -100K | 0 |
| Net Change in Cash | 253M | 279M | 464M | 628M | 371M | -1.11B | 635M | -39M | -379M | 2M | 413M | -145M | 5M | 50M | -425M | 324M | -787M | 633M | -9M | -306M | -5M | -210M | -16M | -766M | 2.02B | 626.96M | -41.56M | -114.9M | -347.9M | 427.6M | -93.8M |
| Free Cash Flow | 1.28B | 823M | 1.04B | 1.11B | -78M | 115M | -155M | 366M | 676M | 649M | 1.2B | 868M | 1.42B | 1.03B | 1.28B | 815M | 1.19B | 1.59B | 1.59B | 1.4B | 678M | 951M | 1.18B | 1.9B | 935.07M | 377.76M | -567.46M | 239.2M | 596.6M | 359.1M | 463.2M |
| FCF Margin % | 8.29% | 5.36% | 6.89% | 7.47% | -0.5% | 0.69% | -1.12% | 2.23% | 4.08% | 4.09% | 7.7% | 5.49% | 8.61% | 6.41% | 8.16% | 5.6% | 8.09% | 11.23% | 10.97% | 8.88% | 4.25% | 5.94% | 7.24% | 11.98% | 6.47% | 2.73% | -4.15% | 2.06% | 6.59% | 5.52% | 8.77% |
| FCF Growth % | 45.28% | -20.79% | -6.56% | 1525.64% | -167.83% | 174.19% | -142.35% | -45.86% | 4.16% | -45.69% | 37.67% | -38.66% | 36.71% | -18.95% | 56.69% | -31.34% | -25.53% | 0% | 13.94% | 106.34% | -28.71% | -19.27% | -37.97% | 103.09% | 147.53% | 166.57% | -337.23% | -59.91% | 66.14% | -22.47% | 147.97% |
| FCF per Share | 3.38 | 2.14 | 2.71 | 2.96 | -0.21 | 0.30 | -0.41 | 0.97 | 1.74 | 1.64 | 2.99 | 2.10 | 3.22 | 2.22 | 2.62 | 1.53 | 1.85 | 2.28 | 2.28 | 1.76 | 0.81 | 1.05 | 1.19 | 1.92 | 1.06 | 0.44 | -0.65 | 0.27 | 0.66 | 0.39 | 0.48 |
| FCF Conversion (FCF/Net Income) | 1.33x | 1.58x | 1.76x | 3.05x | -3.00x | 3.16x | -0.36x | 4.02x | 1.38x | 1.63x | 2.54x | 1.73x | 1.69x | 1.33x | 1.71x | 1.64x | 1.45x | 1.75x | 1.75x | 2.50x | 1.61x | 1.39x | 1.39x | 2.11x | 2.59x | -169.74x | 1.47x | 1.31x | 1.69x | 1.58x | 1.84x |
| Interest Paid | 1M | 0 | 63M | 74M | 76M | 180M | 145M | 76M | 76M | 76M | 82M | 78M | 77M | 77M | 83M | 45M | 1M | 3M | 3M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 131M | 0 | 237M | 49M | 0 | 215M | 20M | 176M | 143M | 570M | 488M | 452M | 714M | 805M | 582M | 599M | 677M | 702M | 702M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Working Capital Volatility
According to quarterly financial data, GAP exhibits significant volatility in cash conversion, with the OCF/NI ratio swinging from a low of -0.73 in 2025Q1 to a high of 5.76 in 2025Q4, suggesting that reported net income is frequently decoupled from actual cash generation.
The wide variance in the OCF/NI ratio indicates that accrual-based accounting adjustments, particularly regarding inventory and payables, heavily influence reported profitability. Investors should monitor whether this inconsistency reflects genuine operational shifts or merely the timing of seasonal working capital requirements that obscure the underlying cash-generative quality of the business.
As reported in recent filings, GAP's free cash flow margins have demonstrated extreme inconsistency, ranging from a negative 6.4% in 2025Q1 to a peak of 16.4% in 2025Q4, highlighting the company's difficulty in maintaining a predictable cash flow trajectory amidst seasonal retail cycles.
The erratic nature of FCF margins suggests that the company's cash flow is highly sensitive to the timing of inventory build-ups and subsequent clearance sales. This lack of stability warrants further investigation into whether the current capital allocation strategy can be sustained without relying on periodic, non-recurring working capital inflows.
Based on the provided cash flow statements, working capital changes are the primary driver of liquidity fluctuations, with a notable $585 million inflow in 2025Q4 contrasting sharply with a $498 million outflow in 2025Q1, illustrating the intense seasonal pressure on the company's cash position.
The significant swings in working capital suggest that the company's cash flow is heavily dependent on the efficient management of inventory and vendor payment terms. This reliance on seasonal working capital cycles may indicate that the company's core operations are not yet generating the consistent, self-sustaining cash flow required for long-term stability.
Data from recent financial statements indicates that GAP has prioritized share repurchases, notably spending $401 million in 2026Q1, even as operating cash flow remained constrained at $213 million, suggesting a potentially aggressive approach to capital return that may outpace the company's internal cash generation capacity.
The decision to allocate significant capital to buybacks during periods of lower cash conversion appears to prioritize shareholder returns over balance sheet fortification. Investors should monitor whether this deployment strategy limits the company's flexibility to invest in necessary digital and store-level infrastructure improvements.
Quick answers to the most common questions about buying GAP stock.
The Gap, Inc. (GAP) generated $1.29B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
The Gap, Inc. (GAP) generated $823.0M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
The Gap, Inc. (GAP) spent $470.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, The Gap, Inc. (GAP) returned $247.0M to shareholders via cash dividends and spent $155.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.