Dick's Sporting Goods stock dropped roughly 20% Tuesday after second-quarter earnings missed Wall Street's targets and the retailer cut its full-year outlook. Foot Locker, acquired last year, posted a pro forma comparable sales decline and an operating loss, while the core Dick's business kept growing.
Dick's Sporting Goods shares fell about 20% in morning trading Tuesday after the retailer reported second-quarter results that missed Wall Street's expectations. The stock also dropped 19.83% in premarket trading to $143.77 from a previous close of $179.33.
The company cited a challenging athletic footwear and apparel marketplace for the miss. Adjusted earnings came in at $3.53 per share against a Wall Street forecast of $3.76, while revenue reached $5.59 billion versus an expected $5.65 billion. Net income fell to $315 million, or $3.50 per share, down from $381 million, or $4.71 per share, a year earlier.
Foot Locker weighs on the outlook
Foot Locker, which Dick's acquired for $2.4 billion in 2025, was the main source of pressure. Its pro forma comparable sales fell 3.6% for the quarter, and the banner posted an operating loss of $31.9 million. As a result, Dick's lowered its Foot Locker comparable sales outlook to a range of flat to down 2%.
The company also cut its overall net sales outlook for the year to a range of $21.9 billion to $22.2 billion, down from a prior range of $22.1 billion to $22.4 billion. It lowered its consolidated operating income outlook to a range of $1.45 billion to $1.55 billion, from $1.69 billion to $1.81 billion previously.
Core Dick's business keeps growing
Even so, the Dick's stores banner posted 4.9% comparable sales growth for the quarter, helped by broad-based gains across categories and strong results tied to the World Cup. Dick's still expects that core business to grow between 2.5% and 4% for the year.
Executive Chairman Ed Stack said the softness reflects industry-wide dynamics rather than falling demand. According to the earnings call transcript: "I do not think this is a demand issue" he said, pointing instead to inventory clearing and a shift toward newer products.
The company also said it received $59 million in tariff refunds during the quarter, plus $2.1 million in related interest income.
Sources: CNBC, Investing.com
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