Gap (GPS)

AND FULL YEAR EARNINGS PER SHARE OF $1.05

SAN FRANCISCO – February 28, 2008 – Gap Inc. (NYSE:GPS) today announced net earnings for the fourth quarter and fiscal year 2007, both of which ended February 2, 2008. Net earnings for the 13 weeks ended February 2, 2008 were $265 million, or $0.35 per share on a diluted basis, compared with $219 million, or $0.27 per share on a diluted basis, for the 14 weeks ended February 3, 2007. Earnings per share on a diluted basis for the 52 weeks ended February 2, 2008 were $1.05, compared with $0.93 for the 53 weeks ended February 3, 2007.

Excluding about $0.07 per diluted share of expenses associated with the company’s cost reduction initiatives and discontinued operation of Forth & Towne, the company’s diluted earnings per share for fiscal year 2007 was $1.12. Please see the reconciliation of diluted earnings per share on a GAAP basis to diluted earnings per share excluding these costs, a non-GAAP financial measure, in the table at the end of this release.

“In 2007, the company made the business decisions and changes necessary to deliver improved earnings for our shareholders,” said Glenn Murphy, chairman and chief executive officer of Gap Inc. “While we’re aware of the challenging economic environment, our leadership team is committed to delivering the right product to our customers while we bring a sharp operational discipline to our business priorities. We’ll work tirelessly to reconnect with customers while we continue to improve our earnings results.”