Dick’s Sporting Goods (DKS) lowered its full-year sales and profit forecasts on Tuesday after quarterly earnings fell short of analyst expectations.
The company’s shares fell about 19% in premarket trading following the results.
Shares of Nike, Adidas and Puma also declined, indicating that investors viewed the results as a broader warning for the sportswear industry.
Dick’s reported adjusted earnings per share of $3.53, below the $3.76 expected by analysts.
Revenue rose to $5.59 billion from $3.65 billion a year earlier, but missed the $5.65 billion consensus estimate.
For the period ended Aug. 1, the retailer reported net income of $315 million, or $3.50 per share, compared with $381 million, or $4.71 per share, a year earlier.
After adjusting for one-time items, including costs related to its Foot Locker acquisition, earnings came to $3.53 per share.
The company now expects full-year net sales of between $21.9 billion and $22.2 billion, down from its previous forecast of $22.1 billion to $22.4 billion.
“Not only were there fewer launches in the second quarter, but those launches performed below both industry and our expectations,” the company’s executive chairman, Ed Stack, said, adding that the company is taking a more cautious view of the rest of the year.
Foot Locker struggles to regain momentum
The results highlight the challenges facing Foot Locker as Dick’s works to turn around the business following its $2.4 billion acquisition in 2025.
Dick’s said comparable sales at its namesake stores increased 4.9% during the quarter, supported by “broad-based growth” across categories, including strong results from the World Cup.
Foot Locker, however, reported a 3.6% decline in comparable sales.
Dick’s now expects comparable sales at the division to range from flat to down 2% for the full year, compared with its previous forecast for growth of 1.5% to 3%.
The company maintained its outlook for comparable sales growth of 2.5% to 4% at its namesake business.
Dick’s said the quarter was marked by heavy discounts across athletic footwear and apparel, forcing the retailer to increase promotions to remain competitive.
“This environment had a more significant impact on the Foot Locker business given its greater exposure to legacy footwear silhouettes and greater dependence on footwear launch and retro product,” Stack added.
Heavy discounts pressure the market
The company lowered its full-year adjusted earnings-per-share forecast to $11-$12 from $13.50-$14.50 previously.
Its consolidated operating income forecast was also reduced to $1.45 billion-$1.55 billion from $1.69 billion-$1.81 billion.
The weaker outlook comes as US consumers defer expensive purchases and prioritize essential spending amid higher food and gasoline costs.
Dick’s has been attempting to reposition Foot Locker and return the retailer to growth, with the acquisition intended to strengthen its international presence and competitive position.
The company also received $59 million in tariff refunds during the quarter, along with $2.1 million in related interest income.
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