Gap lowers outlook as revenue misses; shares fall

Sale signs in the windows of a GAP store.
Scott Mlyn | CNBC

Gap shares fell in extended-hours trading on Thursday after the clothing retailer missed revenue expectations and lowered its full-year guidance.

The company handed in third-quarter earnings of 80 cents per share, topping Wall Street forecasts by a penny, but revenue came in light at $3.97 billion, versus expectations of $4.04 billion.

The company also lowered its full-year guidance. It now sees full-year 2014 earnings coming in between $2.73 per share and $2.78 per share. Analysts had expected full-year earnings of $2.82 per share.

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Shares fell as much as 5 percent on the news.

The San Francisco-based company, which operates Gap, Old Navy and Banana Republic, said same-store-sales fell 2 percent, as Wall Street had expected.

"As we move into the holiday season, our teams are focused on delivering unique customer experiences which will differentiate our portfolio of brands in the marketplace," CEO Glenn Murphy said in a statement.

Gap said it expects the holiday season, which ramps up after Thanksgiving in the U.S., to "remain highly promotional and competitive." Black Friday sales can account for as much as 40 percent of a retailer's annual revenue.