8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

August 22, 2007

Date of Report (Date of earliest event reported)

THE GYMBOREE CORPORATION

(Exact Name of Registrant as Specified in Charter)

Delaware	000-21250	94-2615258
(State or Other Jurisdiction of Incorporation)	(Commission File No.)	(IRS Employer Identification No.)

500 Howard Street, San Francisco, CA	94105
(Address of principal executive offices)	(Zip Code)

(415) 278-7000

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On August 22, 2007, The Gymboree Corporation issued an earnings release announcing, and subsequently held a conference call to discuss, its financial results for the second fiscal quarter ended August 4, 2007. A copy of the press release is attached hereto as Exhibit 99.1, and a copy of the transcript of the call is attached hereto as Exhibit 99.2. The press release and transcript should be read in conjunction with the note in the press release and comments in the transcript regarding forward-looking statements.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No. Description

99.1 Earnings release of The Gymboree Corporation issued August 22, 2007.

99.2 Transcript of conference call hosted by The Gymboree Corporation on August 22, 2007.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	THE GYMBOREE CORPORATION
Dated: August 22, 2007	By:	/s/ BLAIR W. LAMBERT
		Name: Blair W. Lambert Title: Chief Operating Officer and Chief Financial Officer

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EXHIBIT INDEX

Exhibit No. Description

99.1 Earnings release of The Gymboree Corporation issued August 22, 2007.

99.2 Transcript of conference call hosted by The Gymboree Corporation on August 22, 2007.

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EX-99.1

EXHIBIT 99.1

Investor Relations contact:

Jeffrey P. Harris

Tel: 415-278-7933

investor_relations@gymboree.com

Media Relations contact:

Jamie Falkowski

Tel: 415-278-7942

media_relations@gymboree.com

The Gymboree Corporation Reports Second Quarter 2007 Results

San Francisco, Calif., August 22, 2007 - The Gymboree Corporation (NASDAQ: GYMB) today reported earnings for the second fiscal quarter ended August 4, 2007, of $5.8 million or $0.19 per diluted share. This compares to earnings from continuing operations of $1.2 million or $0.04 per diluted share for the same period of the prior year.

“During the second quarter, we increased gross profit percentages, leveraged operating expenses and significantly improved our profitability,” said Matthew McCauley, Chairman and Chief Executive Officer. “Our ongoing merchandising, customer acquisition, store base expansion and expense management strategies are proving successful. We expect these strategies to continue to provide benefits throughout the remainder of the year and into 2008.”

Net sales from retail operations for the fiscal quarter ended August 4, 2007, totaled $179.9 million, a 20% increase over the $149.6 million in net sales from continuing retail operations for the second fiscal quarter of the prior year. As previously reported, comparable store sales for the second fiscal quarter increased 5% over the same period last year. Total net sales for the second fiscalquarter were $182.4 million, an increase of 20% compared to total net sales of $152.1 million from continuing operations for the second fiscal quarter last year.

Business Outlook

For the third fiscal quarter, the Company expects a low to mid-single digit comparable store sales increase over the same period of the prior year. The Company expects earnings for the third fiscal quarter in the range of $0.84 to $0.87 per diluted share. For the full fiscal year 2007, the Company now expects net income to be in the range of $2.50 to $2.53 per diluted share.

Management Presentations

The live broadcast of the discussion of second quarter 2007 financial results will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Wednesday, August 22, 2007. To listen to the live broadcast over the internet, please log on to www.gymboree.com, click on “Our Company” at the bottom of the page, go to “Investor and Media Relations” and then “Conference Calls, Webcasts & Presentations.” A replay of the call will be available two hours after the broadcast through midnight ET, Wednesday, August 29, 2007, at 800-642-1687, Passcode 8087449.

Gymboree reports same store sales results on a quarterly basis and provides a business update at the end of each month. The next monthly business updates will be available on Thursday, September 6, 2007, October 11, 2007, and November 8, 2007, respectively. Please listen to our monthly business update by calling the Company’s Investor Relations Hotline at 415-278-7933. Each monthly recording will be available through Wednesday of the following week after initial release.

About The Gymboree Corporation

The Gymboree Corporation’s specialty retail brands offer unique, high-quality products delivered with personalized customer service. As of August 4, 2007, the Company operated a total of 739 retail stores: 585 Gymboree® stores (555 in the United States and 30 in Canada), 70 Gymboree Outlet stores, 83 Janie and Jack® shops and 1 Crazy 8™ store in the United States. The Company also operates online stores at www.gymboree.com, www.janieandjack.com and www.crazy8.com, and offers directed parent-child developmental play programs at 541 franchised and Company-operated centers in the United States and 31 other countries.

Forward-Looking Statements

The foregoing financial information for the second fiscal quarter ended August 4, 2007, is un-audited and subject to quarter-end and year-end adjustment, and could differ materially from the financial information indicated. The foregoing paragraphs contain forward-looking statements relating to anticipated sales growth and future financial performance. These are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially as a result of a number of factors, including customer reactions to new merchandise, service levels and new concepts, success in meeting our delivery targets, the level of our promotional activity, our gross margin achievement, our ability to appropriately manage inventory, general economic conditions, effects of future embargos from countries used to source product, and competitive market conditions. Other factors that may cause actual results to differ materially include those set forth in the reports that we file from time to time with the Securities and Exchange Commission, including our annual report on Form 10-K for the year-ended February 3, 2007. These forward-looking statements reflect The Gymboree Corporation’s expectations as of August 22, 2007. The Gymboree Corporation undertakes no obligation to update the information provided herein.

Gymboree and Janie and Jack are registered trademarks of The Gymboree Corporation. Crazy 8 is a trademark of The Gymboree Corporation.

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EXHIBIT A

THE GYMBOREE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share and operating data)

(Unaudited)

	13 Weeks Ended			13 Weeks Ended			26 Weeks Ended			26 Weeks Ended
	August 4,			July 29,			August 4,			July 29,
	2007			2006			2007			2006
Net sales:
Retail	$	179,854		$	149,643		$	386,575		$	332,679
Play & Music		2,500			2,481			5,079			5,248
Total net sales		182,354			152,124			391,654			337,927
Cost of goods sold, including buying and occupance expenses		(102,141	)		(86,873	)		(207,641	)		(182,367	)
Gross profit		80,213			65,251			184,013			155,560
Selling, general and administrative expenses		(71,737	)		(65,434	)		(141,930	)		(127,268	)
Operating income (loss)		8,476			(183	)		42,083			28,292
Other income		637			1,748			1,755			2,986
Income from continuing operations, before income taxes		9,113			1,565			43,838			31,278
Income tax expense		(3,311	)		(405	)		(17,181	)		(11,506	)
Income from continuing operations, net of tax		5,802			1,160			26,657			19,772
Loss from discontinued operations, net of tax		-			(616	)		-			(1,345	)
Net income	$	5,802		$	544		$	26,657		$	18,427
Basic per share amounts:
Income from continuing operations, net of tax	$	0.20		$	0.04		$	0.90		$	0.62
Loss from discontinued operations, net of tax		-			(0.02	)		-			(0.04	)
Net income	$	0.20		$	0.02		$	0.90		$	0.58
Diluted per share amounts:
Income from continuing operations, net of tax	$	0.19		$	0.04		$	0.86		$	0.59
Loss from discontinued operations, net of tax		-			(0.02	)		-			(0.04	)
Net income	$	0.19		$	0.02		$	0.86		$	0.55
Weighted average shares outstanding:
Basic		29,323			31,570			29,659			32,031
Diluted		30,452			33,041			30,846			33,380
Operating Data:
Stores Open at the Beginning of the Period		720			655			698			642
New Stores		20			12			45			25
Closed Stores		(1	)		-			(4	)		-
Stores Open at the End of the Period		739			667			739			667
Gross Store Square Footage		1,410,000			1,250,000			1,410,000			1,250,000
Merchandise Inventories per Store	$	157,000		$	139,000		$	157,000		$	139,000

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

	August 4,		February 3,		July 29,
	2007		2007		2006
Current Assets
Cash and cash equivalents	$	34,023	$	27,493	$	31,581
Marketable securities		-		129,325		85,250
Accounts receivable		17,700		12,988		11,068
Merchandise inventories		115,677		104,293		92,541
Prepaid income taxes		18,412		-		16,056
Prepaid expenses and deferred taxes		23,406		19,621		7,422
Current assets of discontinued operations		-		126		11,726
Total current assets		209,218		293,846		255,644
Property and Equipment, net		177,983		150,251		139,740
Lease Rights, Deferred Taxes and Other Assets		14,104		10,111		5,580
Total Assets	$	401,305	$	454,208	$	400,964
Current Liabilities
Accounts payable	$	57,391	$	55,872	$	43,901
Accrued liabilities		72,385		66,334		69,512
Income tax payable		-		8,002		-
Current liabilities of discontinued operations		-		1,928		3,849
Total current liabilities		129,776		132,136		117,262
Long Term Liabilities
Deferred rent and other liabilities		59,574		46,345		46,475
Stockholders' Equity		211,955		275,727		237,227
Total Liabilities and Stockholders' Equity	$	401,305	$	454,208	$	400,964

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EX-99.2

EXHIBIT 99.2