Sales growth at all four brands led to a 20% increase in Gap's earnings, with the company's share price also rising.

• The retailer raised its full-year guidance after beating quarterly estimates on both the top and bottom lines.
• Richard Dickson, CEO of the apparel company, informed CNBC that they were fulfilling their promise to shareholders.
• Gap's four brands, including its flagship store, Old Navy, Athleta, and Banana Republic, experienced positive comparable sales for the first time in a long time.

The apparel giant reported positive comparable sales at all four of its brands on Thursday, prompting it to raise its full-year guidance as CEO Richard Dickson's turnaround strategy begins to show results.

The retailer behind Gap, Banana Republic, Athleta, and Old Navy surpassed earnings expectations and also reported higher revenue.

Based on a survey of analysts by LSEG, how Gap performed compared to Wall Street's expectations.

• Earnings per share: 41 cents vs. 14 cents expected
• Revenue: $3.39 billion vs. $3.29 billion expected

Gap shares spiked more than 20% in extended trading Thursday.

In the first quarter of the fiscal year, the company's net income was $158 million, or 41 cents per share, which is a significant improvement from the previous year's loss of $18 million, or 5 cents per share.

The sales for the period ending May 4 increased by approximately 3% to $3.39 billion from $3.28 billion in the previous year.

CEO Richard Dickson stated in an interview with CNBC that it was the first time in many years that all four brands had reflected positive comps. Despite searching for this occurrence, it proved challenging to determine when it had happened.

"Our confidence in our quarter has led us to raise our guidance for full year 2024, both for revenue and operating margin. This demonstrates our belief that our priorities are taking shape. Our culture is being energized and we are delivering on our promises to our shareholders."

Gap has revised its forecast for net sales and gross margins. While it initially predicted flat sales, it now expects a slight increase. Additionally, the company has raised its guidance for gross margins growth to at least 1.5 percentage points, up from the earlier target of at least half a percent.

Gap has revised its forecast for operating income growth, predicting a mid-40% increase instead of the previously forecasted low-to-mid teens growth.

Dickson, who assumed leadership of Gap in August, is a marketing expert who has been concentrating on revitalizing the company's brand portfolio. His efforts have centered on brand storytelling and repositioning Gap and Old Navy as central to popular culture.

Some of that has already started to show up.

In recent weeks, both actress Da'Vine Joy Randolph and actor Anne Hathaway have worn Gap outfits designed by Zac Posen to high-profile events.

"Dickson stated, "We were thrilled to see Hathaway's dress in the marketplace and made it accessible to consumers so they could purchase it. We still believe that effective storytelling through marketing and creative media is resonating with consumers.""

The quarter's success was attributed to consistency, financial and operational rigor, and leaner inventory levels that have led to better sell-throughs. Additionally, better designs and marketing have resulted in consumers buying more.

Here's a closer look at each brand's performance:

• Old Navy reported a 5% increase in net sales compared to the previous year, but this was lower than the 4.9% growth analysts had predicted. Despite this, Dickson considered the brand's "highest quarterly comp in three years" a success. He highlighted the strength of the women's business and positive results in the active category, which is crucial for the company.

• Banana Republic reported a 2% increase in sales of $440 million compared to the previous year, surpassing expectations of a 1.9% decline. This growth follows an 8% decline in the prior year.

• Athleta's comparable sales increased by 5% after a 13% decline in the previous year, despite analysts not anticipating such growth.

• Gap's comparable sales were up 3%, in line with estimates, but its sales of $689 million were flat compared to last year. The company attributed its performance to strong marketing and product execution centered around its Linen Moves campaign.