The Gap, Inc. (GAP)

Return on assets (ROA)

		Feb 3, 2024	Jan 28, 2023	Jan 29, 2022	Jan 30, 2021	Feb 1, 2020
Net income	US$ in thousands	502,000	-202,000	256,000	-665,000	351,000
Total assets	US$ in thousands	11,044,000	11,386,000	12,761,000	13,769,000	13,679,000
ROA		4.55%	-1.77%	2.01%	-4.83%	2.57%

February 3, 2024 calculation

ROA = Net income ÷ Total assets
= $502,000K ÷ $11,044,000K
= 4.55%

The Return on Assets (ROA) measures The Gap, Inc.'s profitability in generating earnings from its assets. The trend in ROA over the past five years indicates fluctuations in the company's ability to utilize its assets efficiently.

The Gap, Inc. experienced a negative ROA in January 2023 and January 2021, indicating that the company's assets were not effectively utilized to generate profits during those periods. In contrast, positive ROA figures in the other three years show periods where the company was able to generate earnings from its assets.

The significant positive ROA in February 2024 indicates a notable improvement in profitability and efficient asset management compared to the previous years. This suggests that The Gap, Inc. made effective use of its assets to generate earnings in the most recent fiscal year.

Overall, The Gap, Inc. has shown some variability in its ROA performance over the past five years, with fluctuations between positive and negative figures. The company should continue to monitor and improve its asset utilization to sustain profitability and enhance shareholder value in the future.