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

November 19, 2008

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 November 19, 2008, The Gymboree Corporation issued an earnings release announcing its financial results for the third fiscal quarter ended November 1, 2008. A copy of the press release is attached hereto as Exhibit 99.1. The press release should be read in conjunction with the note regarding forward-looking statements, which is included in the text of the press release.

Item 9.01 Financial Statements and Exhibits.

(d)	Exhibits.
	Exhibit No.	Description
	99.1	Earnings release of The Gymboree Corporation issued November 19, 2008.

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: November 19, 2008	By:	/s/ BLAIR W. LAMBERT
		Name: Blair W. Lambert Title:   Chief Operating Officer and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Earnings release of The Gymboree Corporation issued November 19, 2008.

EX-99.1

EXHIBIT 99.1

Investor Relations contact:

Jeffrey P. Harris

Tel: 415-278-7933

investor_relations@gymboree.com

Media Relations contact:

Mark Mizicko

Tel: 415-278-7503

media_relations@gymboree.com

The Gymboree Corporation Reports Third Quarter 2008 Results

San Francisco, Calif., November 19, 2008 - The Gymboree Corporation (NASDAQ: GYMB) today reported earnings for the third fiscal quarter ended November 1, 2008, of $30.9 million or $1.06 per diluted share. This compares to earnings of $26.9 million or $0.91 per diluted share for the same period of the prior year.

Net sales from retail operations for the fiscal quarter ended November 1, 2008, totaled $261.3 million, a 6% increase over the $247.6 million in net sales from retail operations for the third fiscal quarter of the prior year. As previously reported, comparable store sales for the third fiscal quarter decreased 2% over the same period last year. Total net sales for the third fiscalquarter were $264.1 million, compared to total net sales of $250.7 million for the same fiscal quarter last year.

“We are extremely pleased to report a 16% increase in earnings per share in the face of a difficult retail environment,” said Matthew McCauley, Chairman and Chief Executive Officer. “And while we are proud of this accomplishment, we anticipate the upcoming holiday season and following year to be more challenging given an expected pullback in consumer spending.”

Business Outlook

For the fourth fiscal quarter, the Company expects comparable store sales to decrease in the range of mid-single digits over the same period of the prior year. The Company expects earnings for the fourth fiscal quarter to be in the range of $0.92 to $1.00 per diluted share. For the full fiscal year 2008, the Company expects net income to be in the range of $3.12 to $3.20 per diluted share.

Management Presentations

The live broadcast of the discussion of third quarter 2008 financial results will be available to interested parties at 1:30 p.m. PT (4:30 p.m. ET) on Wednesday, November 19, 2008. 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, November 26, 2008, at 800-642-1687, Passcode 32949127.

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, December 4, 2008, January 8, 2009, and February 5, 2009, 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 November 1, 2008, the Company operated a total of 873 retail stores: 614 Gymboree® stores (585 in the United States and 29 in Canada), 112 Gymboree Outlet stores, 110 Janie and Jack® shops and 37 Crazy 8® stores in the United States. The Company also operates online stores at www.gymboree.com, www.janieandjack.com, and www.crazy8.com. The Company also offers directed parent-child developmental play programs at 597 franchised and Company-operated centers in the United States and 30 other countries.

Forward-Looking Statements

The foregoing financial information for the third fiscal quarter ended November 1, 2008, 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 2, 2008. These forward-looking statements reflect The Gymboree Corporation’s expectations as of November 19, 2008. The Gymboree Corporation undertakes no obligation to update the information provided herein.

Gymboree, Janie and Jack and Crazy 8 are registered trademarks of The Gymboree Corporation.

###

THE GYMBOREE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share and operating data)

(Unaudited)

	13 Weeks Ended			13 Weeks Ended			39 Weeks Ended			39 Weeks Ended
	November 1,			November 3,			November 1,			November 3,
	2008			2007			2008			2007
Net sales:
Retail	$	261,296		$	247,569		$	703,031		$	634,145
Play & Music		2,809			3,163			8,926			8,242
Total net sales		264,105			250,732			711,957			642,387
Cost of goods sold, including
buying and occupancy expenses		(129,520	)		(126,020	)		(360,012	)		(333,661	)
Gross profit		134,585			124,712			351,945			308,726
Selling, general and administrative expenses		(84,377	)		(80,314	)		(247,269	)		(222,244	)
Operating income		50,208			44,398			104,676			86,482
Other income		152			691			849			2,446
Income before income taxes		50,360			45,089			105,525			88,928
Income tax expense		(19,413	)		(18,194	)		(41,529	)		(35,376	)
Net income	$	30,947		$	26,895		$	63,996		$	53,552
Net income per share:
Basic	$	1.10		$	0.94		$	2.30		$	1.83
Diluted	$	1.06		$	0.91		$	2.20		$	1.76
Weighted average shares outstanding:
Basic		28,051			28,565			27,861			29,294
Diluted		29,099			29,621			29,073			30,438
Operating Data:
Stores Open at the Beginning of the Period		835			739			786			698
New Stores		39			34			90			79
Closed Stores		(1	)		-			(3	)		(4	)
Stores Open at the End of the Period		873			773			873			773
Gross Store Square Footage		1,706,000			1,489,000			1,706,000			1,489,000
Merchandise Inventories per Square Foot	$	83		$	88		$	83		$	88
Supplemental Financial Information
Depreciation and amortization	$	8,761		$	7,982		$	25,782		$	22,686
Interest income, net	$	362		$	351		$	948		$	2,093
Stock-based compensation	$	4,939		$	3,167		$	14,363		$	8,805

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

	November 1,		February 2,		November 3,
	2008		2008		2007
Current Assets
Cash and cash equivalents	$	93,153	$	33,313	$	24,096
Accounts receivable		15,793		12,640		19,403
Merchandise inventories		142,042		119,523		130,520
Prepaid income taxes		804		-		-
Prepaid expenses and deferred taxes		24,126		23,748		21,993
Total current assets		275,918		189,224		196,012
Property and Equipment, net		206,630		185,357		186,680
Deferred Taxes and Other Assets		18,078		22,603		14,750
Total Assets	$	500,626	$	397,184	$	397,442
Current Liabilities
Accounts payable	$	59,941	$	52,915	$	62,974
Accrued liabilities		70,266		70,282		75,078
Income tax payable		-		7,989		1,641
Total current liabilities		130,207		131,186		139,693
Long Term Liabilities
Deferred rent and other liabilities		70,272		57,703		61,242
Stockholders' Equity		300,147		208,295		196,507
Total Liabilities and Stockholders' Equity	$	500,626	$	397,184	$	397,442