CNN Business
Gap Inc. is rapidly burning through cash as its stores remain shut during the coronavirus pandemic. The clothing company said its future is uncertain if it doesn’t get the help it needs to keep its business operational.
The company issued a dire warning in a regulatory filing Thursday that $1 billion in cash has evaporated from its accounts since February. Gap said it might have as little as $750 million in the bank as early as next week.
Gap said it needs to take “additional actions to both preserve existing liquidity and seek additional sources of liquidity” over the next year because the money it’s currently making isn’t enough to sustain operations.
It’s taking action to preserve cash, including implementing furloughs of roughly 80,000 store employees, cutting executive pay and not paying April rent for its temporarily closed stores. The latter move is saving the Gap in $115 million in monthly expenses in North America.
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