Dick’s Falls Most Ever With Chairman Saying More Pain to Come
(Bloomberg) — Dick’s Sporting Goods Inc. sank the most on record after reporting that the Foot Locker chain it acquired last year continues to struggle, raising doubts about the broader sneaker market.
The company now expects net sales to be in a range of $21.9 billion to $22.2 billion in the current fiscal year, down from its previous forecast. The change in outlook was driven by a drop in sales at Foot Locker, which Dick’s bought last year for $2.4 billion.
“We’re going to go through some pain,” Dick’s Chairman Ed Stack said on a call with analysts.
Dick’s said the footwear market became increasingly promotional last quarter after brands upped discounting on their own websites. The company said legacy sneaker styles aren’t resonating like they once did, while not naming a specific brand. Dick’s instead is seeing a shift to brands such as Ugg and Birkenstock.
Shares of Dick’s fell as much as 28%, the biggest intraday drop since the retailer went public in 2002. The stock had declined about 9% this year through Monday’s close, compared with a 12% gain for the S&P 500 Index.
Dick’s is the latest consumer company to cut guidance, and its report hit shares of suppliers including Nike Inc., which saw its stock dropped as much as 4.2%. The S&P Composite 1500 Textiles, Apparel & Luxury Goods Index also slid, with declines led by Lululemon Athletica Inc. and Deckers Outdoor Corp.
The results and lower outlook deepens skepticism about the merits of the Foot Locker acquisition, Lindsay Dutch, a senior analyst with Bloomberg Intelligence, said in a note.
When the Foot Locker deal was announced in May 2025, there was some criticism from analysts about Dick’s taking on a troubled retailer that would expose the company more to struggling malls.
Foot Locker’s proforma comparable sales fell 3.6% last quarter, while Dick’s stores posted almost 5% growth. More hurdles are anticipated through the remainder of the year, with the company saying it expects elevated discounting to continue.
Dick’s is also dealing with US consumers who have become more choosy amid rising costs. On the call, the company cited macroeconomic concerns weighing on profitability.
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–With assistance from Janet Freund.
(Updates shares.)
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